PennantPark Floating Rate Capital Ltd. [PFLT] Filings

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

10-Q 1 pflt-20231231.htm 10-Q 10-Q

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)r


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 2023


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM TO

COMMISSION FILE NUMBER: 814-00891

PENNANTPARK FLOATING RATE CAPITAL LTD.

(Exact name of registrant as specified in its charter)


MARYLAND		27-3794690
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1691 Michigan Avenue Miami Beach, Florida		33139
(Address of principal executive offices)		(Zip Code)

(786) 297-9500

(Registrant’s Telephone Number, Including Area Code)

None

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, par value $0.001 per share	PFLT	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the registrant’s common stock, $0.001 par value per share, outstanding as of February 7, 2024 was 61,627,881.

PENNANTPARK FLOATING RATE CAPITAL LTD.

FORM 10-Q FOR THE QUARTER ENDED DECEMBER 31, 2023

TABLE OF CONTENTS


PART I. CONSOLIDATED FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

Consolidated Statements of Assets and Liabilities as of December 31, 2023 (unaudited) and September 30, 2023		4

Consolidated Statements of Operations for the three months ended December 31, 2023 and 2022 (unaudited)		5

Consolidated Statements of Changes in Net Assets for the three months ended December 31, 2023 and 2022 (unaudited)		6

Consolidated Statements of Cash Flows for the three months ended December 31, 2023 and 2022 (unaudited)		7

Consolidated Schedules of Investments as of December 31, 2023 (unaudited) and September 30, 2023		8

Notes to Consolidated Financial Statements (unaudited)		20

Report of Independent Registered Public Accounting Firm (PCAOB ID 49)		39

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		41

Item 3. Quantitative and Qualitative Disclosures About Market Risk		55

Item 4. Controls and Procedures		55

PART II. OTHER INFORMATION

Item 1. Legal Proceedings		57

Item 1A. Risk Factors		57

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds		58

Item 3. Defaults Upon Senior Securities		58

Item 4. Mine Safety Disclosures		58

Item 5. Other Information		58

Item 6. Exhibits		59

SIGNATURES		60

PART I—CONSOLIDATED FINANCIAL INFORMATION

We are filing this Quarterly Report on Form 10-Q, or the Report, in compliance with Rule 13a-13 as promulgated by the Securities and Exchange Commission, or the SEC, under the Securities Exchange Act of 1934, as amended, or the Exchange Act. In this Report, except where the context suggests otherwise, the terms “Company,” “we,” “our” or “us” refers to PennantPark Floating Rate Capital Ltd. and its wholly-owned consolidated subsidiaries; “Funding I” refers to PennantPark Floating Rate Funding I, LLC; “Taxable Subsidiary” refers to PFLT Investment Holdings, LLC; “PSSL” refers to PennantPark Senior Secured Loan Fund I LLC, an unconsolidated joint venture; “PTSF” refers to PennantPark-TSO Senior Loan Fund, LP, an unconsolidated limited partnership; “PennantPark Investment Advisers” or “Investment Adviser” refer to PennantPark Investment Advisers, LLC; “PennantPark Investment Administration” or “Administrator” refers to PennantPark Investment Administration, LLC; “2023 Notes” refers to our 4.3% Series A notes due 2023; “2026 Notes” refers to our 4.25% Notes due 2026; “1940 Act” refers to the Investment Company Act of 1940, as amended; “SBCAA” refers to the Small Business Credit Availability Act; “Code” refers to the Internal Revenue Code of 1986, as amended; “RIC” refers to a regulated investment company under the Code; “BDC” refers to a business development company under the 1940 Act; “Credit Facility” refers to our multi-currency senior secured revolving credit facility, as amended from time to time, with Truist Bank and other lenders, or the “Lenders,” entered into on August 12, 2021; “Securitization Issuer” refers to PennantPark CLO I, Ltd.; “Securitization Issuers” refers to the Securitization Issuer and PennantPark CLO I, LLC; “Debt Securitization” refers to the $301.4 million term debt securitization completed by the Securitization Issuers; “2031 Asset-Backed Debt” refers to (i) the issuance of the Class A-1 Senior Secured Floating Rate Notes due 2031, the Class A-2 Senior Secured Fixed Rate Notes due 2031, the Class B-1 Senior Secured Floating Rate Notes due 2031, the Class B-2 Senior Secured Fixed Rate Notes due 2031, the Class C-1 Secured Deferrable Floating Rate Notes due 2031, the Class C-2 Notes Secured Deferrable Fixed Rate Notes due 2031, and the Class D Secured Deferrable Floating Notes due 2031 and (ii) the borrowing of the Class A‑1 Senior Secured Floating Rate Notes due 2031 by the Securitization Issuers in connection with the Debt Securitization; and “Depositor” refers to PennantPark CLO I Depositor, LLC. References to our portfolio, our investments, our multi-currency, senior secured revolving credit facility, as amended and restated, or the Credit Facility, and our business include investments we make through our subsidiaries.

Item 1. Consolidated Financial Statements

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

(in thousands, except share and per share data)


	December 31, 2023			September 30, 2023
	(unaudited)
Assets
Investments at fair value
Non-controlled, non-affiliated investments (amortized cost— $965,446 and $768,240, respectively)	$	974,595		$	772,178
Controlled, affiliated investments (amortized cost— $325,032 and $324,639, respectively)		296,332			294,996
Total investments (amortized cost— $1,290,478 and $1,092,878, respectively)		1,270,927			1,067,174
Cash and cash equivalents (cost— $75,809 and $100,555, respectively)		75,826			100,555
Interest receivable		11,636			10,423
Distributions receivable		508			565
Due from affiliate		142			—
Prepaid expenses and other assets		20			894
Total assets		1,359,059			1,179,611
Liabilities
Credit Facility payable, at fair value (cost— $260,855 and $9,400, respectively)		260,917			9,400
2031 Asset-Backed Debt, net (par—$228,000)		226,917			226,759
2026 Notes payable, net (par—$185,000)		183,248			183,054
Interest payable on debt		6,520			8,615
Distributions payable		6,020			6,020
Payable for investments purchased		5,578			4,905
Incentive fee payable		4,863			4,628
Base management fee payable		2,951			2,759
Deferred tax liability		1,794			1,794
Accounts payable and accrued expenses		1,746			1,287
Due to affiliates		492			566
2023 Notes payable, at fair value (par—$0 and $76,219, respectively)		—			76,219
Total liabilities		701,046			526,006
Commitments and contingencies (See Note 11)
Net assets
Common stock, 58,734,702 and 58,734,702 shares issued and outstanding, respectively Par value $0.001 per share and 100,000,000 shares authorized		59			59
Paid-in capital in excess of par value		765,187			765,187
Accumulated deficit		(107,233	)		(111,641	)
Total net assets	$	658,013		$	653,605
Total liabilities and net assets	$	1,359,059		$	1,179,611
Net asset value per share	$	11.20		$	11.13

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(Unaudited)


	Three Months Ended December 31,
	2023			2022
Investment income:
From non-controlled, non-affiliated investments:
Interest	$	23,768		$	20,735
Dividend		508			577
Other income		1,763			142
From controlled, affiliated investments:
Interest		8,434			6,909
Dividend		3,500			2,975
Total investment income		37,973			31,338
Expenses:
Interest and expenses on debt		8,942			9,858
Performance-based incentive fee		4,863			3,433
Base management fee		2,951			2,931
General and administrative expenses		988			706
Administrative services expenses		626			144
Expenses before provision for taxes		18,370			17,072
Provision for taxes on net investment income		154			534
Total expenses		18,524			17,606
Net investment income		19,449			13,732
Realized and unrealized gain (loss) on investments and debt:
Net realized gain (loss) on:
Non-controlled, non-affiliated investments		(3,089	)		63
Non-controlled and controlled, affiliated investments		—			—
Net realized gain (loss) on investments		(3,089	)		63
Net change in unrealized appreciation (depreciation) on:
Non-controlled, non-affiliated investments		5,228			(12,693	)
Controlled and non-controlled, affiliated investments		943			(4,064	)
Provision for taxes on unrealized appreciation (depreciation) on investments		—			(725	)
Debt (appreciation) depreciation		(62	)		2,067
Net change in unrealized appreciation (depreciation) on investments and debt		6,109			(15,415	)
Net realized and unrealized gain (loss) from investments and debt		3,020			(15,352	)
Net increase (decrease) in net assets resulting from operations	$	22,469		$	(1,620	)
Net increase (decrease) in net assets resulting from operations per common share (See Note 7)	$	0.38		$	(0.04	)
Net investment income per common share	$	0.33		$	0.30

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CHANGES IN NET ASSETS

(in thousands, except share issue data)

(Unaudited)


	Three Months Ended December 31,
	2023			2022
Net increase (decrease) in net assets from operations:
Net investment income	$	19,449		$	13,732
Net realized gain (loss) on investments		(3,089	)		63
Net change in unrealized appreciation (depreciation) on investments		6,171			(16,757	)
Net change in provision for taxes on unrealized appreciation (depreciation) on investments		—			(725	)
Net change in unrealized (appreciation) depreciation on debt		(62	)		2,067
Net increase (decrease) in net assets resulting from operations		22,469			(1,620	)
Distributions to stockholders:
Distribution of net investment income		(18,061	)		(12,932	)
Total distributions to stockholders		(18,061	)		(12,932	)
Capital transactions
Public offering		—			995
Offering costs		—			(5	)
Net increase in net assets resulting from capital transactions		—			990
Net increase (decrease) in net assets		4,408			(13,562	)
Net assets:
Beginning of period		653,605			527,092
End of period	$	658,013		$	513,530
Capital share activity:
Shares issued from public offering		—			86,177

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)


	Three months ended December 31,
	2023			2022
Cash flows from operating activities:
Net increase (decrease) in net assets resulting from operations	$	22,469		$	(1,620	)
Adjustments to reconcile net increase (decrease) in net assets resulting from operations to net cash provided by (used in) operating activities:
Net change in unrealized appreciation (depreciation) on investments		(6,171	)		16,757
Net change in unrealized (appreciation) depreciation on debt		62			(2,067	)
Net realized (gain) loss on investments		3,089			(63	)
Net accretion of discount and amortization of premium		(1,026	)		(944	)
Purchases of investments		(302,598	)		(65,587	)
Payment-in-kind interest		(867	)		(56	)
Proceeds from dispositions of investments		103,803			62,998
Amortization of deferred financing costs		352			352
(Increase) decrease in:
Interest receivable		(1,213	)		(1,193	)
Distribution receivable		57			(577	)
Receivable for investments sold		—			(8,912	)
Prepaid expenses and other assets		874			(197	)
Due from affiliate		(142	)		—
Increase (decrease) in:
Payable for investments purchased		673			9,990
Interest payable on debt		(2,095	)		(2,088	)
Base management fee payable		192			(96	)
Incentive fee payable		235			269
Deferred tax liability		—			725
Due to affiliates		(74	)		(1,486	)
Account payable and accrued expenses		459			72
Net cash provided by (used in) operating activities		(181,921	)		6,277
Cash flows from financing activities:
Proceeds from public offering		—			995
Offering costs		—			(15	)
Distributions paid to stockholders		(18,061	)		(12,924	)
Repayment of 2023 notes payable		(76,219	)		(20,787	)
Borrowings under Credit Facility		251,455			30,000
Repayments under Credit Facility		—			—
Net cash provided by (used in) financing activities		157,175			(2,731	)
Net increase (decrease) in cash and cash equivalents		(24,746	)		3,546
Effect of exchange rate changes on cash		17			23
Cash and cash equivalents, beginning of period		100,555			51,488
Cash and cash equivalents, end of period	$	75,826		$	55,057
Supplemental disclosures:
Interest paid	$	10,685		$	11,594
Taxes paid	$	160		$	5
Non-cash exchanges and conversions	$	5,067		$	—

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

DECEMBER 31, 2023

(in thousands, except share data)

(Unaudited)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Investments in Non-Controlled, Non-Affiliated Portfolio Companies—148.1% (3), (4)
First Lien Secured Debt—129.2%
A1 Garage Merger Sub, LLC	12/22/2028	Commercial Services & Supplies		11.96	%	3M SOFR+660			1,516	$	1,497	$	1,509
A1 Garage Merger Sub, LLC LLC (Revolver) (7), (9)	12/22/2028	Commercial Services & Supplies		—			—		748		—		(4	)
A1 Garage Merger Sub, LLC - Unfunded Term Loan	12/22/2028	Commercial Services & Supplies		—			—		528		—		5
ACP Avenu Buyer, LLC	10/02/2029	IT Services		11.64	%	3M SOFR+625			10,313		10,124		10,055
ACP Avenu Buyer, LLC (Revolver) (7), (9)	10/02/2029	IT Services		—			—		3,807		—		(95	)
ACP Avenu Buyer, LLC - Unfunded Term Loan	10/02/2029	IT Services		—			—		9,517		—		(107	)
ACP Falcon Buyer, LLC (Revolver) (7), (9)	08/01/2029	Professional Services		—			—		3,096		—		(34	)
Ad.net Acquisition, LLC	05/07/2026	Media		11.61	%	3M SOFR+626			4,875		4,837		4,851
Ad.net Acquisition, LLC (Revolver) (7)	05/07/2026	Media		11.61	%	3M SOFR+626			622		622		619
Ad.net Acquisition, LLC (Revolver) (7), (9)	05/07/2026	Media		—			—		622		—		(3	)
Aeronix, Inc.	12/18/2028	Aerospace and Defense		10.88	%	3M SOFR+550			49,000		48,271		48,265
Aeronix, Inc. (Revolver) (9)	12/18/2028	Aerospace and Defense		—			—		6,099		—		—
AFC Dell Holding Corp.	04/09/2027	Distributors		11.71	%	3M SOFR+640			3,865		3,813		3,812
AFC Dell Holding Corp. - Unfunded Term Loan	04/09/2027	Distributors		—			—		22,497		—		—
Amsive Holding Corporation (f/k/a Vision Purchaser Corporation)	06/10/2025	Media		11.75	%	3M SOFR+640			13,922		13,836		13,713
Anteriad, LLC (f/k/a MeritDirect, LLC)	05/23/2024	Media		11.00	%	3M SOFR+565			13,591		13,572		13,455
Anteriad, LLC (f/k/a MeritDirect, LLC) - Incremental Term Loan	05/23/2024	Media		12.00	%	3M SOFR+665			2,183		2,169		2,172
Anteriad, LLC (f/k/a MeritDirect, LLC) (Revolver) (7), (9)	05/23/2024	Media		—			—		2,869		—		(29	)
Any Hour Services	07/21/2027	Energy Equipment and Services		11.23	%	3M SOFR+585			6,378		6,310		6,314
Any Hour Services (Revolver) (7), (9)	07/21/2027	Energy Equipment and Services		—			—		1,147		—		(11	)
Applied Technical Services, LLC	12/29/2026	Commercial Services & Supplies		11.28	%	3M SOFR+615			9,449		9,345		9,260
Applied Technical Services, LLC (Revolver) (7)	12/29/2026	Commercial Services & Supplies		13.25	%	3M SOFR+475			732		732		717
Applied Technical Services, LLC (Revolver) (7), (9)	12/29/2026	Commercial Services & Supplies		—			—		541		—		(11	)
Arcfield Acquisition Corp.	08/03/2029	Aerospace and Defense		11.64	%	1M SOFR+625			5,996		5,908		5,936
Arcfield Acquisition Corp. (Revolver) (9)	08/04/2028	Aerospace and Defense		—			—		1,379		—		(14	)
Beta Plus Technologies, Inc.	07/01/2029	Internet Software and Services		11.10	%	1M SOFR+575			4,938		4,853		4,740
BioDerm, Inc. (Revolver) (7)	01/31/2028	Healthcare Equipment and Supplies		11.84	%	1M SOFR+650			268		268		265
BioDerm, Inc. (Revolver) (9)	01/31/2028	Healthcare Equipment and Supplies		—			—		804		—		(8	)
Blackhawk Industrial Distribution, Inc.	09/17/2026	Distributors		11.49	%	3M SOFR+565			5,302		5,256		5,236
Blackhawk Industrial Distribution, Inc. - Unfunded Term Loan	09/17/2026	Distributors		—			—		2,337		—		(6	)
Blackhawk Industrial Distribution, Inc. (Revolver) (7)	09/17/2026	Distributors		13.75	%	3M SOFR+525			823		823		813
Blackhawk Industrial Distribution, Inc. (9)	09/17/2026	Distributors		—			—		1,920		—		(24	)
BlueHalo Financing Holdings, LLC	10/31/2025	Aerospace and Defense		12.01	%	3M SOFR+665			5,408		5,366		5,299
Broder Bros., Co.	12/04/2025	Textiles, Apparel and Luxury Goods		11.61	%	3M SOFR+626			3,302		3,302		3,302
By Light Professional IT Services, LLC	05/16/2025	High Tech Industries		12.40	%	3M SOFR+688			25,148		24,995		24,645
By Light Professional IT Services, LLC (Revolver) (7)(9)	05/16/2025	High Tech Industries		—			—		3,507		—		(70	)
Carisk Buyer, Inc.	12/01/2029	Healthcare Technology		11.10	%	3M SOFR+575			5,500		5,418		5,418
Carisk Buyer, Inc. - Unfunded Term Loan	12/01/2029	Healthcare Technology		—			—		4,813		—		(24	)
Carisk Buyer, Inc. (Revolver) (7)(9)	12/01/2029	Healthcare Technology		—			—		1,750		—		(26	)
Cartessa Aesthetics, LLC	06/14/2028	Distributors		11.10	%	1M SOFR+575			13,043		12,882		13,043
Cartessa Aesthetics, LLC (Revolver) (7)	06/14/2028	Distributors		11.10	%	1M SOFR+575			511		511		511
Cartessa Aesthetics, LLC (Revolver) (7)(9)	06/14/2028	Distributors		—			—		927		—		-
CF512, Inc.	08/20/2026	Media		11.55	%	3M SOFR+619			5,964		5,921		5,845
CF512, Inc. (Revolver) (7), (9)	08/20/2026	Media		—			—		955		—		(19	)
CHA Holdings, Inc.	04/10/2025	Environmental Industries		9.97	%	3M SOFR+461			1,560		1,558		1,560
Challenger Performance Optimization, Inc.	08/31/2024	Business Services		13.19	%	3M SOFR+775			236		236		228
Compex Legal Services, Inc.	02/09/2026	Professional Services		10.96	%	3M SOFR+555			8,902		8,871		8,902
Compex Legal Services, Inc. (Revolver) (7)	02/07/2025	Professional Services		10.92	%	3M SOFR+555			422		422		422
Compex Legal Services, Inc. (Revolver) (7), (9)	02/07/2025	Professional Services		—			—		984		—		—
Connatix Buyer, Inc.	07/13/2027	Media		11.14	%	3M SOFR+576			3,805		3,755		3,634
Connatix Buyer, Inc. (7), (9)	07/13/2027	Media		—			—		1,234		—		(56	)
Crane 1 Services, Inc.	08/16/2027	Commercial Services & Supplies		10.36	%	3M SOFR+501			880		868		876
Crane 1 Services, Inc. (Revolver) (7)	08/16/2027	Commercial Services & Supplies		10.36	%	3M SOFR+501			135		135		134
Crane 1 Services, Inc. (Revolver) (7)	08/16/2027	Commercial Services & Supplies		—			—		202		—		(1	)
Dr. Squatch, LLC	08/31/2027	Personal Products		11.20	%	3M SOFR+585			4,372		4,321		4,372
Dr. Squatch, LLC (Revolver) (7), (9)	08/31/2027	Personal Products		—			—		3,353		—		—
DRS Holdings III, Inc.	11/03/2025	Chemicals, Plastics and Rubber		11.75	%	3M SOFR+640			15,993		15,884		15,817
DRS Holdings III, Inc. (Revolver) (7), (9)	11/03/2025	Personal Products		—			—		1,426		—		(16	)
Duraco Specialty Tapes LLC	06/30/2024	Containers and Packaging		11.96	%	3M SOFR+650			3,436		3,411		3,381
ECL Entertainment, LLC	08/31/2030	Hotels, Restaurants and Leisure		10.11	%	1M SOFR+475			4,988		4,900		4,991
EDS Buyer, LLC - Unfunded Term Loan	01/10/2029	Electronic Equipment, Instruments, and Components		—			—		6,750		—		17
EDS Buyer, LLC. (Revolver) (7), (9)	01/10/2029	Electronic Equipment, Instruments, and Components		—			—		2,025		—		(20	)
Efficient Collaborative Retail Marketing Company, LLC	06/15/2024	Media: Diversified and Production		15.97	%	3M SOFR+1050			8,150		8,164		5,705
ETE Intermediate II, LLC (Revolver) (9)	05/25/2029	Diversified Consumer Services		—			—		1,656		—		-
Exigo Intermediate II, LLC (Revolver) (9)	03/15/2027	Software		—			—		689		—		(10	)
Five Star Buyer, Inc.	02/23/2028	Hotels, Restaurants and Leisure		12.46	%	3M SOFR+710			4,536		4,459		4,468
Five Star Buyer, Inc. - DDTL B Unfunded	02/23/2028	Hotels, Restaurants and Leisure		—			—		837		-		(13	)
Five Star Buyer, Inc. (Revolver) (9)	02/23/2028	Hotels, Restaurants and Leisure		—			—		741		-		(11	)
Gauge ETE Blocker, LLC - Promissory Note	05/19/2029	Diversified Consumer Services		12.56	%		—		215		215		215
Global Holdings InterCo LLC	03/16/2026	Diversified Financial Services		11.46	%	3M SOFR+610			3,271		3,245		3,107
Graffiti Buyer, Inc.	08/10/2027	Trading Companies & Distributors		10.98	%	3M SOFR+560			1,066		1,056		1,055
Graffiti Buyer, Inc. (Revolver) (7)	08/10/2027	Trading Companies & Distributors		10.97	%	3M SOFR+560			298		298		295
Graffiti Buyer, Inc. (Revolver) (7), (9)	08/10/2027	Trading Companies & Distributors		—			—		567		—		(6	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

DECEMBER 31, 2023

(in thousands, except share data)

(Unaudited)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Hancock Roofing and Construction L.L.C.	12/31/2026	Insurance		10.95	%	3M SOFR+560			4,172	$	4,116	$	4,005
Hancock Roofing and Construction L.L.C. (Revolver) (7)	12/31/2026	Insurance		10.96	%	3M SOFR+560			335		335		322
Hancock Roofing and Construction L.L.C. (Revolver) (7), (9)	12/31/2026	Insurance		—			—		415		—		(17	)
Holdco Sands Intermediate, LLC	11/23/2028	Aerospace and Defense		11.71	%	3M SOFR+635			13,624		13,400		13,531
Holdco Sands Intermediate, LLC (Revolver) (9)	11/23/2027	Aerospace and Defense		—			—		1,791		—		(18	)
HW Holdco, LLC	12/10/2024	Media		11.82	%	1M SOFR+640			9,000		8,978		8,865
HW Holdco, LLC (Revolver)	12/10/2024	Media		11.79	%	1M SOFR+640			116		116		114
HW Holdco, LLC (Revolver) (7), (9)	12/10/2024	Media		—			—		1,335		—		(20	)
IG Investments Holdings, LLC (7)	09/22/2028	Professional Services		11.48	%	3M SOFR+610			4,417		4,351		4,350
IG Investments Holdings, LLC (Revolver) (7), (9)	09/22/2027	Professional Services		—			—		477		—		(7	)
Imagine Acquisitionco, LLC (9)	11/15/2027	Software		—			—		1,657		—		(8	)
Imagine Acquisitionco, LLC (Revolver) (9)	11/15/2027	Software		—			—		1,193		—		(18	)
Inception Fertility Ventures, LLC	12/31/2024	Healthcare Providers and Services		12.64	%	3M SOFR+725			15,766		15,652		15,766
Infinity Home Services Holdco, Inc.	12/28/2028	Commercial Services & Supplies		12.21	%	3M SOFR+685			2,084		2,084		2,084
Infinity Home Services Holdco, Inc. (CAD)	12/28/2028	Commercial Services & Supplies		12.25	%	3M SOFR+675		CAD 1,450			1,043		1,080
Infinity Home Services Holdco, Inc. - Unfunded Term Loan	02/15/2024	Commercial Services & Supplies		—			—		1,135		—		—
Infinity Home Services Holdco, Inc. - 1st Amendment Unfunded Term Loan	11/17/2025	Commercial Services & Supplies		—			—		6,122		—		(31	)
Infinity Home Services Holdco, Inc. (Revolver) (9)	12/28/2028	Commercial Services & Supplies		—			—		1,292		—		—
Infolinks Media Buyco, LLC	11/01/2026	Media		11.21	%	3M SOFR+585			2,940		2,906		2,940
Integrative Nutrition, LLC	01/31/2025	Consumer Services		12.50	%	3M SOFR+715			15,557		15,499		14,468
Integrity Marketing Acquisition, LLC	08/27/2026	Insurance		11.53	%	3M SOFR+615			16,182		16,073		16,020
Integrity Marketing Acquisition, LLC - Unfunded Term Loan	08/31/2025	Insurance		—			—		7,440		—		(37	)
Integrity Marketing Acquisition, LLC (Revolver) (7), (9)	08/27/2026	Insurance		—			—		511		—		—
ITI Holdings, Inc. (Revolver)	03/03/2028	IT Services		12.07	%	3M SOFR+560			500		500		485
ITI Holdings, Inc. (Revolver) (9)	03/03/2028	IT Services		—			—		165		—		(5	)
Inventus Power, Inc.	06/30/2025	Electronic Equipment, Instruments, and Components		12.97	%	3M SOFR+761			4,975		4,893		4,875
Inventus Power, Inc. (Revolver) (7), (9)	06/30/2025	Electronic Equipment, Instruments, and Components		—			—		1,729		—		(35	)
K2 Pure Solutions NoCal, L.P. (Revolver) (7), (9)	01/31/2024	Chemicals, Plastics and Rubber		—			—		1,429		—		—
Kinetic Purchaser, LLC	11/10/2027	Personal Products		11.50	%	3M SOFR+615			17,210		16,970		17,124
Kinetic Purchaser, LLC - (Revolver) (9)	11/10/2026	Personal Products		—			—		3,435		—		(17	)
Lash OpCo, LLC	02/18/2027	Personal Products		12.48	%	1M SOFR+700			10,378		10,250		10,326
Lash OpCo, LLC (Revolver) (7)	08/16/2026	Personal Products		12.53	%	1M SOFR+700			2,086		2,086		2,076
Lash OpCo, LLC (Revolver) (7), (9)	08/16/2026	Personal Products		—			—		986		—		(5	)
LAV Gear Holdings, Inc.	10/31/2025	Capital Equipment		11.81	%	1M SOFR+640			13,104		13,099		12,816
			(PIK 5.50%)
LAV Gear Holdings, Inc. (Revolver) (7)	10/31/2025	Capital Equipment		11.78	%	1M SOFR+640			1,721		1,721		1,683
			(PIK 5.50%)
Ledge Lounger, Inc.	11/09/2026	Leisure Products		12.00	%	3M SOFR+665			3,700		3,675		3,663
Ledge Lounger, Inc. (Revolver)	11/09/2026	Leisure Products		12.00	%	3M SOFR+665			592		592		586
Ledge Lounger, Inc. (Revolver) (9)	11/09/2026	Leisure Products		—			—		197		—		(2	)
Lightspeed Buyer Inc.	02/03/2026	Healthcare Technology		10.71	%	1M SOFR+535			22,484		22,249		22,372
Lightspeed Buyer Inc. (Revolver) (7) (9)	02/03/2026	Healthcare Technology		—			—		2,499		—		(12	)
LJ Avalon Holdings, LLC	02/01/2030	Construction & Engineering		11.86	%	3M SOFR+640			1,101		1,088		1,079
LJ Avalon Holdings, LLC - Unfunded Term Loan	07/31/2024	Construction & Engineering		—			—		1,721		—		(9	)
LJ Avalon Holdings, LLC (Revolver) (9)	01/31/2030	Construction & Engineering		—			—		1,130		—		(23	)
Loving Tan Intermediate II, Inc.	05/31/2028	Personal Products		12.35	%	3M SOFR+700			19,215		18,861		19,022
Loving Tan Intermediate II, Inc. (Revolver)	05/31/2028	Personal Products		12.35	%	3M SOFR+700			1,861		1,861		1,842
Loving Tan Intermediate II, Inc. (Revolver)(7)(9)	05/31/2028	Personal Products		—			—		1,523		—		(15	)
Lucky Bucks, LLC - First-out Term Loan	10/02/2028	Hotels, Restaurants and Leisure		13.03	%	3M SOFR+765			261		261		261
Lucky Bucks, LLC - Last-out Term Loan	10/02/2029	Hotels, Restaurants and Leisure		13.03	%	3M SOFR+765			522		522		522
MAG DS Corp.	04/01/2027	Aerospace and Defense		10.95	%	1M SOFR+550			3,664		3,561		3,499
Mars Acquisition Holdings Corp.	05/14/2026	Media		11.00	%	3M SOFR+565			8,706		8,603		8,706
Mars Acquisition Holdings Corp. (Revolver)(7)(9)	05/14/2026	Media		—			—		2,435		—		-
MBS Holdings, Inc. (Revolver)	04/16/2027	Internet Software and Services		11.21	%	3M SOFR+585			694		694		684
MBS Holdings, Inc. (Revolver)(7)(9)	04/16/2027	Internet Software and Services		—			—		463		—		(7	)
MDI Buyer, Inc.	07/25/2028	Commodity Chemicals		11.63	%	3M SOFR+625			2,036		1,999		1,986
MDI Buyer, inc. (Revolver) (7)	07/25/2028	Commodity Chemicals		11.39	%	3M SOFR+600			273		273		266
MDI Buyer, inc. (Revolver) (9)	07/25/2028	Commodity Chemicals		—			—		500		—		(8	)
Meadowlark Acquirer, LLC	12/10/2027	Professional Services		11.00	%	3M SOFR+565			1,973		1,950		1,914
Meadowlark Acquirer, LLC - Term Loan II	12/10/2027	Professional Services		—			—		9,483		—		(190	)
Meadowlark Acquirer, LLC (Revolver) (9)	12/10/2027	Professional Services		—			—		1,693		—		(51	)
Medina Health, LLC	10/20/2028	Healthcare Providers and Services		11.60	%	3M SOFR+625			17,954		17,647		17,595
Medina Health, LLC (Revolver) (7)	10/20/2028	Healthcare Providers and Services		11.60	%	3M SOFR+625			778		778		762
Medina Health, LLC (Revolver) (9)	10/20/2028	Healthcare Providers and Services		—			—		4,409		—		(88	)
Mission Critical Electronics, Inc.	03/28/2024	Capital Equipment		11.23	%	3M SOFR +590			3,562		3,556		3,562
Mission Critical Electronics, Inc. (9)	03/28/2024	Capital Equipment		—			—		707		—		3
Mission Critical Electronics, Inc. (Revolver) (7), (9)	03/28/2024	Capital Equipment		—			—		1,325		—		—
Municipal Emergency Services, Inc.	10/01/2027	Distributors		10.51	%	3M SOFR+515			1,178		1,143		1,177
Municipal Emergency Services, Inc. - Unfunded Term Loan A	12/16/2024	Distributors		—			—		387		—		—
Municipal Emergency Services, Inc. - Unfunded Term Loan B	12/16/2024	Distributors		—			—		1,264		—		(1	)
Municipal Emergency Services, Inc. (Revolver) (7), (9)	10/01/2027	Distributors		—			—		947		—		(1	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

DECEMBER 31, 2023

(in thousands, except share data)

(Unaudited)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Neptune Flood Incorporated (Revolver) (9)	05/09/2029	Insurance		—			—		541	$	-	$	-
NBH Group LLC (Revolver) (7), (9)	08/19/2026	Healthcare Equipment and Supplies		—			—		1,677		—		(101	)
NORA Acquisition, LLC	08/31/2029	Healthcare Providers and Services		11.70	%	3M SOFR+635			19,950		19,566		19,651
NORA Acquisition, LLC (Revolver) (7), (9)	08/31/2029	Healthcare Providers and Services		—			—		5,479		—		(82	)
Omnia Exterior Solutions, LLC	12/29/2029	Diversified Consumer Services		10.85	%	3M SOFR+550			6,500		6,403		6,403
Omnia Exterior Solutions, LLC - Unfunded Term Loan 1	03/28/2024	Diversified Consumer Services		—			—		5,200		—		—
Omnia Exterior Solutions, LLC - Unfunded Term Loan 2	12/29/2025	Diversified Consumer Services		—			—		9,100		—		—
Omnia Exterior Solutions, LLC (Revolver) (7), (9)	12/29/2029	Diversified Consumer Services		—			—		2,600		—		—
One Stop Mailing, LLC	05/07/2027	Air Freight and Logistics		11.72	%	3M SOFR+636			8,493		8,381		8,493
ORL Acquisition, Inc. (7)	09/03/2027	Consumer Finance		12.75	%	3M SOFR+740			4,888		4,820		4,154
ORL Acquisition, Inc. (Revolver) (7), (9)	09/03/2027	Consumer Finance		—			—		861		—		(129	)
OSP Embedded Purchaser, LLC	12/15/2029	Aerospace and Defense		11.20	%	3M SOFR+585			12,900		12,675		12,674
OSP Embedded Purchaser, LLC (Revolver) (9)	12/15/2029	Aerospace and Defense		—			—		2,932		—		—
Output Services Group, Inc. - First-out Term Loan	11/30/2028	Business Services		13.82	%	3M SOFR+843			521		521		521
Output Services Group, Inc. - Last-out Term Loan	05/30/2028	Business Services		12.07	%	3M SOFR+668			1,058		1,058		1,058
Owl Acquisition, LLC	02/04/2028	Professional Services		10.75	%	3M SOFR+550			3,893		3,802		3,834
Ox Two, LLC	05/18/2026	Construction and Building		12.86	%	1M SOFR+751			22,736		22,531		22,452
Ox Two, LLC (Revolver) (9)	05/18/2026	Construction and Building		—			—		3,387		—		(42	)
Pacific Purchaser, LLC	09/30/2028	Professional Services		11.43	%	3M SOFR+625			5,000		4,902		4,925
Pacific Purchaser, LLC - Unfunded Term Loan	09/30/2028	Professional Services		—			—		3,598		—		—
Pacific Purchaser, LLC - (Revolver) (9)	09/30/2028	Professional Services		—			—		1,799		—		(27	)
Pequod Merger Sub, Inc. - Unfunded Term Loan	12/02/2026	Diversified Financial Services		—			—		2,847		—		(57	)
Pequod Merger Sub, Inc (Revolver) (9)	12/02/2026	Diversified Financial Services		—			—		757		—		(15	)
PL Acquisitionco, LLC	11/09/2027	Textiles, Apparel and Luxury Goods		12.46	%	3M SOFR+710			5,661		5,591		5,010
PL Acquisitionco, LLC - (Revolver) (9)	11/09/2027	Textiles, Apparel and Luxury Goods		—			—		2,290		—		(263	)
PlayPower, Inc.	05/08/2026	Leisure Products		11.06	%	1M SOFR+565			3,392		3,377		3,290
Pragmatic Institute, LLC - Unfunded Term Loan	07/06/2028	Professional Services		—			—		2,290		—		(126	)
Pragmatic Institute, LLC (Revolver)	07/06/2028	Professional Services		11.12	%	3M SOFR+575			1,526		1,526		1,427
Quantic Electronics, LLC	11/19/2026	Electronic Equipment, Instruments, and Components		11.70	%	1M SOFR+635			6,630		6,567		6,497
Quantic Electronics, LLC (Revolver) (7)	11/19/2026	Electronic Equipment, Instruments, and Components		11.70	%	1M SOFR+635			670		670		657
Questex, LLC	09/09/2024	Media: Diversified and Production		9.77	%	3M SOFR+440			6,731		6,713		6,731
Questex, LLC (Revolver) (7), (9)	09/09/2024	Media: Diversified and Production		—			—		1,197		—		—
Rancho Health MSO, Inc. (Revolver) (7)	12/18/2025	Healthcare Equipment and Supplies		11.20	%	3M SOFR+585			210		210		210
Rancho Health MSO, Inc. (Revolver) (7), (9)	12/18/2025	Healthcare Equipment and Supplies		—			—		315		—		—
Recteq, LLC	01/29/2026	Leisure Products		12.50	%	3M SOFR+715			1,459		1,445		1,408
Recteq, LLC (Revolver) (7), (9)	01/29/2026	Leisure Products		—			—		1,296		—		(45	)
Research Now Group, Inc. and Dynata, LLC	12/20/2024	Business Services		11.14	%	3M SOFR+576			16,917		16,848		14,972
Riverpoint Medical, LLC	06/20/2025	Healthcare Equipment and Supplies		10.50	%	3M SOFR+515			7,919		7,887		7,856
Riverpoint Medical, LLC (Revolver) (7)	06/20/2025	Healthcare Equipment and Supplies		10.46	%	3M SOFR+510			227		227		225
Riverpoint Medical, LLC (Revolver) (7), (9)	06/20/2025	Healthcare Equipment and Supplies		—			—		682		—		(5	)
Riverside Assessments, LLC	03/10/2025	Professional Services		11.25	%	3M SOFR+590			15,159		15,055		15,008
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.) - Unfunded Term Loan	06/15/2029	Professional Services		—			—		1,146		—		—
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.) (Revolver) (7), (9)	06/15/2029	Professional Services		—			—		860		—		(13	)
Sales Benchmark Index LLC	01/03/2025	Professional Services		11.55	%	3M SOFR+620			2,527		2,515		2,514
Sales Benchmark Index LLC (Revolver) (7), (9)	01/03/2025	Professional Services		—			—		1,293		—		(6	)
Sargent & Greenleaf Inc.	12/20/2024	Electronic Equipment, Instruments, and Components		12.96	%	1M SOFR+760			3,410		3,399		3,393
Sargent & Greenleaf Inc. (Revolver)	12/20/2024	Electronic Equipment, Instruments, and Components		12.69	%	1M SOFR+760			597		597		594
Sargent & Greenleaf Inc. (Revolver) (9)	12/20/2024	Electronic Equipment, Instruments, and Components		—			—		484		—		(2	)
Schlesinger Global, Inc.	07/14/2025	Professional Services		12.08	%	3M SOFR + 715			14,490		14,436		14,019
Schlesinger Global, Inc. (Revolver)	07/14/2025	Professional Services		12.53	%	1M SOFR+715			1,499		1,499		1,450
Schlesinger Global, Inc. (Revolver) (7), (9)	07/14/2025	Professional Services		—			—		372		—		(12	)
Seaway Buyer, LLC	06/13/2029	Chemicals, Plastics and Rubber		11.50	%	3M SOFR+615			1,916		1,891		1,849
Sigma Defense Systems, LLC	12/18/2027	IT Services		12.50	%	3M SOFR+715			20,023		19,747		19,823
Sigma Defense Systems, LLC (Revolver) (7)	12/18/2027	IT Services		12.50	%	3M SOFR+715			1,572		1,572		1,557
Sigma Defense Systems, LLC (Revolver) (7), (9)	12/18/2027	IT Services		—			—		1,048		—		(10	)
Signature Systems Holding Company	05/03/2024	Commercial Services & Supplies		12.00	%	1M SOFR+665			8,147		8,138		8,147
Signature Systems Holding Company (Revolver) (9)	05/03/2024	Commercial Services & Supplies		—			—		1,747		—		—
Skopima Consilio Parent, LLC	05/17/2028	Business Services		9.97	%	1M SOFR+450			600		588		595
Smile Brands Inc.	10/14/2025	Healthcare and Pharmaceuticals		9.98	%	1M SOFR+450			2,431		2,431		2,128
Smile Brands Inc. (Revolver)	10/14/2025	Healthcare and Pharmaceuticals		9.95	%	1M SOFR+450			588		588		514
Smile Brands Inc. (Revolver) (7), (9)	10/14/2025	Healthcare and Pharmaceuticals		—			—		928		—		(116	)
Smile Brands Inc. LC (Revolver) (7), (9)	10/14/2025	Healthcare and Pharmaceuticals		—			—		100		—		(13	)
Solutionreach, Inc.	07/17/2025	Healthcare Technology		12.53	%	3M SOFR+700			4,657		4,631		4,643
Solutionreach, Inc. (Revolver) (7), (9)	07/17/2025	Healthcare Technology		—			—		833		—		(2	)
Spendmend Holdings LLC	03/01/2028	Healthcare Technology		11.00	%	3M SOFR + 565			2,056		2,033		2,034
Spendmend Holdings LLC - Unfunded Term Loan	03/01/2024	Healthcare Technology		—			—		1,707		—		(6	)
Spendmend Holdings LLC (Revolver)	03/01/2028	Healthcare Technology		11.02	%	3M SOFR+565			357		357		353
Spendmend Holdings LLC (Revolver) (9)	03/01/2028	Healthcare Technology		—			—		535		—		(6	)
STV Group Incorporated	12/11/2026	Construction & Engineering		10.71	%	1M SOFR+535			4,752		4,726		4,704
Summit Behavioral Healthcare, LLC	11/24/2028	Healthcare Providers and Services		10.40	%	1M SOFR+501			1,995		1,980		1,990
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)	08/16/2027	Aerospace and Defense		11.33	%	3M SOFR+615			18,326		18,077		18,216

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

DECEMBER 31, 2023

(in thousands, except share data)

(Unaudited)


Issuer Name	Maturity		Industry	Current Coupon				Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
System Planning and Analysis, Inc. (Revolver) (9) (f/k/a Management Consulting & Research, LLC)	08/16/2027		Aerospace and Defense		—				—		5,188	$	-	$	(31	)
S101 Holdings, Inc.	12/29/2026		Electronic Equipment, Instruments, and Components		11.55	%		3M SOFR+615			7,742		7,626		7,625
S101 Holdings, Inc. - Unfunded Term Loan	06/15/2024		Electronic Equipment, Instruments, and Components		—				—		4,152		—		—
S101 Holdings, Inc. - Unfunded Term Loan 2	12/15/2024		Electronic Equipment, Instruments, and Components		—				—		9,688		—		—
Teneo Holdings LLC	07/18/2025		Diversified Financial Services		10.71	%		1M SOFR+535			5,718		5,675		5,704
The Bluebird Group LLC	07/28/2026		Professional Services		12.00	%		3M SOFR+665			2,581		2,542		2,552
The Bluebird Group LLC (Revolver) (7), (9)	07/28/2026		Professional Services		—				—		862		—		(9	)
The Plimpton & Hills Corporation	11/07/2029		Distributors		11.37	%		3M SOFR+600			17,026		16,773		16,771
The Plimpton & Hills Corporation - Unfunded Term Loan	11/07/2025		Distributors		—				—		10,812		—		(54	)
The Vertex Companies, LLC (7)	08/30/2027		Construction & Engineering		11.46	%		1M SOFR+610			1,974		1,945		1,968
The Vertex Companies, LLC (Revolver)	08/30/2027		Construction & Engineering		11.46	%		1M SOFR+610			305		305		304
The Vertex Companies, LLC (Revolver) (7), (9)	08/30/2027		Construction & Engineering		—				—		606		—		(2	)
TPC Canada Parent, Inc. and TPC US Parent, LLC (5), (10)	11/24/2025		Food Products		11.04	%		3M SOFR+565			4,800		4,783		4,752
TransGo, LLC	12/29/2028		Auto Components		11.35	%		3M SOFR+600			40,000		39,401		39,400
TransGo, LLC (Revolver) (7), (9)	12/29/2028		Auto Components		0.00	%					5,317		-		-
TWS Acquisition Corporation	06/16/2025		Diversified Consumer Services		11.78	%		1M SOFR+640			3,740		3,714		3,740
TWS Acquisition Corporation (Revolver) (7), (9)	06/16/2025		Diversified Consumer Services		—				—		2,628		—		—
Tyto Athene, LLC	04/01/2028		IT Services		11.04	%		1M SOFR+565			11,928		11,808		11,022
Tyto Athene, LLC (Revolver) (7), (9)	04/01/2026		IT Services		11.02	%		1M SOFR+565			312		311		286
Tyto Athene, LLC (Revolver) (7)	04/01/2026		IT Services		—				—		728		—		(55	)
Walker Edison Furniture, LLC - Term Loan	03/01/2029		Wholesale		12.21	%		3M SOFR+685			4,028		4,028		3,947
Walker Edison Furniture Company, LLC - Unfunded Term Loan	03/01/2029		Wholesale		—				—		1,042		—		(20	)
Walker Edison Furniture Company, LLC - Funded Junior Revolver	03/01/2029		Wholesale		11.71	%		3M SOFR+635			1,667		1,667		1,667
Watchtower Intermediate, LLC	12/01/2029		Electronic Equipment, Instruments, and Components		11.38	%		3M SOFR+600			19,250		18,942		18,865
Watchtower Intermediate, LLC - Unfunded Term Loan	12/01/2025		Electronic Equipment, Instruments, and Components		—				—		4,200		—		(37	)
Watchtower Intermediate, LLC - Funded Revolver	12/01/2029		Electronic Equipment, Instruments, and Components		11.38	%		3M SOFR+600			1,260		1,260		1,235
Watchtower Intermediate, LLC (Revolver) (9)	12/01/2029		Electronic Equipment, Instruments, and Components		—				—		5,040		—		(101	)
Wildcat Buyerco, Inc.	02/26/2027		Electronic Equipment, Instruments, and Components		11.11	%		3M SOFR+575			12,689		12,559		12,499
Wildcat Buyerco, Inc. - Unfunded Term Loan	02/26/2027		Electronic Equipment, Instruments, and Components		—				—		3,281		—		(16	)
Wildcat Buyerco, Inc. (Revolver) (9)	02/26/2027		Electronic Equipment, Instruments, and Components		—				—		534		—		(8	)
Zips Car Wash, LLC	03/01/2024		Automobiles		12.71	%		3M SOFR+735			13,249		13,232		12,951
Total First Lien Secured Debt													862,365		850,023
Second Lien Secured Debt—0.0%
Mailsouth Inc. (7)	04/23/2025		Media: Advertising, Printing and Publishing		—		(6)		—		1,205		965		—
QuantiTech LLC	02/04/2027		Aerospace and Defense		15.47	%		3M SOFR+1,010			150		148		150
Total Second Lien Secured Debt													1,113		150
Preferred Equity— 2.0% (6)
Ad.net Holdings, Inc. (7)		—	Media		—				—		6,720		672		748
Anteriad Holdings, LP (f/k/a MeritDirect Holdings, LP) (7), (8)		—	Media		—				—		2,018		2,018		2,059
Cartessa Aesthetics, LLC (Preferred) (8)		—	Distributors		—				—		1,437,500		1,438		2,133
Gauge Lash Coinvest LLC (Preferred)		—	Personal Products		—				—		108,546		586		1,843
Gauge Schlesinger Coinvest LLC (Preferred Equity)		—	Professional Services		—				—		64		64		36
Imagine Topco, LP		—	Software		8.00	%			—		1,236,027		1,236		1,279
Magnolia Topco LP - Class A Preferred Equity(8)		—	Automobiles		—				—		47		47		49
Magnolia Topco LP - Class B Preferred Equity(8)		—	Automobiles		—				—		31		20		17
Mars Intermediate Holdings II, Inc. (7)		—	Media		—				—		835		835		1,145
NXOF Holdings, Inc. (Tyto Athene, LLC) (7)		—	IT Services		—				—		733		733		749
ORL Holdco, Inc. (7)		—	Consumer Finance		—				—		1,327		133		—
PL Acquisitionco, LLC (Preferred Equity)		—	Textiles, Apparel and Luxury Goods		—				—		61		61		69
Signature CR Intermediate Holdco, Inc. (7)		—	Commercial Services & Supplies		12.00	%			—		1,323		1,323		2,222
TPC Holding Company, LP (5), (7), (10)		—	Food Products		—				—		409		409		614
TWD Parent Holdings, LLC (The Vertex Companies, LLC) (7)		—	Construction & Engineering		—				—		37		35		46
UniTek Global Services, Inc. -		—	Telecommunications		20.00	%			—		343,861		344		221
Super Senior Preferred Equity (7)
UniTek Global Services, Inc. - Senior Preferred Equity (7)		—	Telecommunications		19.00	%			—		448,851		449		—
UniTek Global Services, Inc. (7)		—	Telecommunications		13.50	%			—		1,047,317		670		—
Total Preferred Equity													11,073		13,230
Common Equity/Warrants— 16.9% (6)
A1 Garage Equity, LLC		—	Commercial Services & Supplies		—				—		647,943		648		718
Ad.net Holdings, Inc. (7)		—	Media		—				—		7,467		75		—
Affinion Group Holdings, Inc. (Warrants)	04/10/2024		Consumer Goods: Durable		—				—		8,893		245		—
AFC Acquisitions, Inc.(8)		—	Distributors		—				—		1,262,252		1,262		1,262
Aftermarket Drivetrain Products Holdings, LLC		—	Auto Components		—				—		2,632		2,632		2,632
AG Investco LP (7), (8)		—	Software		—				—		805,164		805		1,125
AG Investco LP (7), (8), (9)		—	Software		—				—		194,836		—		—
Altamira Intermediate Company II, Inc. (7)		—	IT Services		—				—		1,437,500		1,437		1,448
Anteriad Holdings, LP (f/k/a MeritDirect Holdings, LP) (7), (8)		—	Media		—				—		2,018		—		—
Athletico Holdings, LLC (8)		—	Healthcare Providers and Services		—				—		4,678		5,000		4,838

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

DECEMBER 31, 2023

(in thousands, except share data)

(Unaudited)


Issuer Name	Maturity		Industry	Current Coupon		Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
BioDerm Holdings, LP		—	Healthcare Equipment and Supplies		—		—		1,313	$	1,313	$	1,449
Burgess Point Holdings, LP		—	Auto Components		—		—		100		100		96
By Light Investco LP (7), (8)		—	High Tech Industries		—		—		22,789		849		10,924
Carisk Parent, L.P.		—	Healthcare Technology		—		—		169,231		169		169
Connatix Parent, LLC (7)		—	Media		—		—		38,278		421		169
Consello Pacific Aggregator, LLC(8)		—	Professional Services		—		—		1,025,476		1,025		1,046
Crane 1 Acquisition Parent Holdings, L.P. (7)		—	Commercial Services & Supplies		—		—		130		120		199
Delta InvestCo LP (Sigma Defense Systems, LLC) (7), (8)		—	IT Services		—		—		760,273		747		1,189
Delta InvestCo LP (Sigma Defense Systems, LLC) (7), (8),(9)		—	IT Services		—		—		244,597		—		—
eCommission Holding Corporation (7), (10)		—	Banking, Finance, Insurance & Real Estate		—		—		20		251		536
EDS Topco, LP		—	Electronic Equipment, Instruments, and Components		—		—		1,125,000		1,125		1,165
Exigo, LLC		—	Software		—		—		541,667		542		624
FedHC InvestCo LP (7),(8)		—	Aerospace and Defense		—		—		21,665		727		2,372
FedHC InvestCo LP (7),(8),(9)		—	Aerospace and Defense		—		—		7,566		—		—
Five Star Parent Holdings, LLC		—	Hotels, Restaurants and Leisure		—		—		655,714		656		675
Gauge ETE Blocker, LLC		—	Diversified Consumer Services		—		—		374,444		374		371
Gauge Lash Coinvest LLC (7)		—	Personal Products		—		—		1,485,953		227		7,203
Gauge Loving Tan, LP		—	Personal Products		—		—		2,481,781		2,482		2,111
Gauge Schlesinger Coinvest LLC (7)		—	Professional Services		—		—		465		476		263
GCOM InvestCo LP (7)		—	IT Services		—		—		19,184		3,342		4,276
GMP Hills, L.P.		—	Distributors		—		—		4,430,843		4,431		4,431
Go Dawgs Capital III, LP		—	Building Products		—		—		324,675		325		779
(American Insulated Glass, LLC) (7), (8)
Hancock Claims Consultants Investors, LLC (7), (8)		—	Insurance		—		—		450,000		448		207
HPA SPQ Aggregator LP		—	Professional Services		—		—		750,399		750		750
HV Watterson Holdings, LLC		—	Professional Services		—		—		100,000		100		102
Icon Partners V C, L.P.		—	Internet Software and Services		—		—		1,870,915		1,870		1,767
Icon Partners V C, L.P. (7), (9)		—	Internet Software and Services		—		—		629,085		—		(35	)
IIN Group Holdings, LLC		—	Consumer Services		—		—		1,000		1,000		—
(Integrative Nutrition, LLC) (7), (8)
Imagine Topco, LP (Common)		—	Software		—		—		1,236,027		—		—
IHS Parent Holdngs, L.P.		—	Commercial Services & Supplies		—		—		1,218,045		1,218		1,759
Ironclad Holdco, LLC (Applied Technical Services, LLC) (7), (8)		—	Commercial Services & Supplies		—		—		5,811		573		833
ITC Infusion Co-invest, LP (8)		—	Healthcare Equipment and Supplies		—		—		116,032		1,175		1,377
ITC Rumba, LLC (Cano Health, LLC) (7),(8)		—	Healthcare and Pharmaceuticals		—		—		46,763		117		33
Kentucky Racing Holdco, LLC(8)		—	Hotels, Restaurants and Leisure		—		—		87,345		—		940
Kinetic Purchaser, LLC		—	Personal Products		—		—		1,734,775		1,735		2,175
KL Stockton Co-Invest LP (Any Hour Services) (7),(8)		—	Energy Equipment and Services		—		—		382,353		385		861
Lightspeed Investment Holdco LLC (7)		—	Healthcare Technology		—		—		585,587		586		1,545
LJ Avalon, LP		—	Construction & Engineering		—		—		1,638,043		1,638		1,671
Lucky Bucks, LLC		—	Hotels, Restaurants and Leisure		—		—		73,870		2,062		2,062
Magnolia Topco LP - Class A Common Equity(8)		—	Automobiles		—		—		46,974		—		—
Magnolia Topco LP - Class B Common Equity(8)		—	Automobiles		—		—		30,926		—		—
Mars Intermediate Holdings II, Inc. (7)		—	Media		—		—		835		—		233
MDI Aggregator, LP		—	Commodity Chemicals		—		—		10,761		1,077		956
Meadowlark Title, LLC (8)		—	Professional Services		—		—		819,231		805		—
MSpark, LLC		—	Media: Advertising, Printing and Publishing		—		—		3,988		1,287		—
Municipal Emergency Services, Inc. (7)		—	Distributors		—		—		1,973,370		2,005		2,565
NEPRT Parent Holdings, LLC (Recteq, LLC) (7), (8)		—	Leisure Products		—		—		1,494		1,438		76
New Medina Health, LLC(8)		—	Healthcare Providers and Services		—		—		2,672,646		2,673		2,673
NORA Parent Holdings, LLC (8)		—	Healthcare Providers and Services		—		—		2,544		2,544		2,554
North Haven Saints Equity Holdings, LP (8)		—	Healthcare Technology		—		—		223,602		224		235
NXOF Holdings, Inc. (Tyto Athene, LLC) (7)		—	IT Services		—		—		14,960		15		—
OceanSound Discovery Equity, LP (Holdco Sands Intermediate, LLC) (7), (8)		—	Aerospace and Defense		—		—		173,638		1,588		4,584
OHCP V BC COI, L.P.		—	Distributors		—		—		1,152,777		1,153		968
OHCP V BC COI, L.P. (9)		—	Distributors		—		—		97,224		—		(16	)
ORL Holdco, Inc. (7)		—	Consumer Finance		—		—		1,474		15		—
OSP Embedded Aggregator, LP		—	Aerospace and Defense		—		—		1,727,679		1,728		1,728
Output Services Group, Inc.		—	Business Services		—		—		80,170		642		642
PennantPark-TSO Senior Loan Fund, LP (7)		—	Financial Services		—		—		11,167,847		11,168		9,629
LEP Pequod Holdings, LP		—	Financial Services		—		—		350		865		946
Pink Lily Holdco, LLC (PL Acquisitions, LLC) (8)		—	Textiles, Apparel and Luxury Goods		—		—		1,735		1,735		34
Pragmatic Institute, LLC		—	Professional Services		—		—		610,583		611		9
Quad (U.S.) Co-Invest, L.P.			Professional Services		—		—		266,864		267		313
QuantiTech InvestCo LP (7), (8)		—	Aerospace and Defense		—		—		712		68		451
QuantiTech InvestCo LP (7), (8), (9)		—	Aerospace and Defense		—		—		955		—		—
QuantiTech InvestCo II LP (7), (8),		—	Aerospace and Defense		—		—		40		24		26
RFMG Parent, LP (Rancho Health MSO, Inc.) (7)		—	Healthcare Equipment and Supplies		—		—		1,050,000		1,050		1,097
SBI Holdings Investments LLC (Sales Benchmark Index LLC) (7)		—	Professional Services		—		—		64,634		646		520
Seaway Topco, LP			Chemicals, Plastics and Rubber		—		—		296		296		210
Signature CR Intermediate Holdco, Inc. (7)		—	Commercial Services & Supplies		—		—		70		70		1,837
SP L2 Holdings, LLC (Ledge Lounger, Inc.)		—	Leisure Products		—		—		360,103		360		234
SSC Dominion Holdings, LLC		—	Capital Equipment		—		—		24		24		818
Class B (US Dominion, Inc.) (7)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

DECEMBER 31, 2023

(in thousands, except share data)

(Unaudited)


Issuer Name	Maturity		Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
StellPen Holdings, LLC (CF512, Inc.) (7)		—	Media		—			—		161,538	$	161	$	160
SV Aero Holdings, LLC (8)		—	Aerospace and Defense		—			—		61		605		605
TAC LifePort Holdings, LLC (7),(8)		—	Aerospace and Defense		—			—		533,833		525		976
Tower Arch Infolinks Media, LP (Infolinks Media Buyco, LLC)(8)		—	Media		—			—		220,187		206		388
Tower Arch Infolinks Media, LP (Infolinks Media Buyco, LLC)(8) (9)		—	Media		—			—		145,420		—		—
TPC Holding Company, LP (5), (7), (10)		—	Food Products		—			—		21,527		21		363
TWD Parent Holdings, LLC (The Vertex Companies, LLC) (7)		—	Construction & Engineering		—			—		749		1		6
UniTek Global Services, Inc.(C)		—	Telecommunications		—			—		213,739		—		—
UniTek Global Services, Inc. (W)		—	Telecommunications		—			—		23,889		—		—
UniVista Insurance (7), (8)		—	Insurance		—			—		400		357		613
Urology Partners Co., L.P.		—	Healthcare Providers and Services		—			—		694,444		694		583
Walker Edison Holdco LLC		—	Healthcare Providers and Services		—			—		36,458		3,393		—
Watchtower Holdings, LLC (8)		—	Electronic Equipment, Instruments, and Components		—			—		1,241,935		1,242		1,261
WCP IvyRehab QP CF Feeder, LP(8)		—	Healthcare Providers and Services		—			—		3,715,012		3,754		4,071
WCP IvyRehab QP CF Feeder, LP (8), (9)		—	Healthcare Providers and Services		—			—		284,988		—		—
Wildcat Parent, LP (Wildcat Buyerco, Inc.) (7)		—	Electronic Equipment, Instruments, and Components		—			—		2,240		95		727
Total Common Equity/Warrants												90,895		111,192
Total Investments in Non-Controlled, Non-Affiliated Portfolio Companies												965,446		974,595
Investments in Controlled, Affiliated Portfolio Companies—45.0% (3), (4)
First Lien Secured Debt—36.5%
Marketplace Events, LLC - Super Priority First Lien Term Loan (7)	09/30/2025		Media: Diversified and Production		10.94	%	3M SOFR+550			3,582		3,582		3,582
Marketplace Events, LLC - Super Priority First Lien (7), (9)	09/30/2025		Media: Diversified and Production		—			—		3,261		—		—
Marketplace Events, LLC	09/30/2026		Media: Diversified and Production		10.94	%	3M SOFR+550			26,771		21,324		26,771
PennantPark Senior Secured Loan Fund I LLC (7), (9), (10)	05/06/2024		Financial Services		13.42	%	3M SOFR+800			210,088		210,088		210,088
Total First Lien Secured Debt												234,994		240,441
Equity Interests—8.5%
New MPE Holdings, LLC (Marketplace Events, LLC) (7),(8)		—	Media: Diversified and Production		—			—		349		—		3,762
PennantPark Senior Secured Loan Fund I LLC (7), (9), (10)		—	Financial Services		—			—		90,038		90,038		52,129
Total Equity Interests												90,038		55,891
Total Investments in Controlled, Affiliated Portfolio Companies												325,032		296,332
Total Investments—193.1%												1,290,478		1,270,927
Cash and Cash Equivalents—11.5%
Money Market - BlackRock Federal FD Institutional 30												75,809		75,826
Total Cash and Cash Equivalents												75,809		75,826
Total Investments and Cash Equivalents—204.7%											$	1,366,287	$	1,346,753
Liabilities in Excess of Other Assets—(104.7)%														(688,740	)
Net Assets—100.0%													$	658,013

—————

(1)

Represents floating rate instruments that accrue interest at a predetermined spread relative to an index, typically the applicable Secured Overnight Financing Rate, or “SOFR”, or Prime rate, or “P, or Sterling Overnight Index Average, or “SONIA.” The spread may change based on the type of rate used. The terms in the Schedule of Investments disclose the actual interest rate in effect as of the reporting period. SOFR loans are typically indexed to a 30-day, 90-day or 180-day SOFR rates (1M S, 3M S, or 6M S, respectively) at the borrower’s option. SONIA loans are typically indexed daily for GBP loans with a quarterly frequency payment. All securities are subject to a SOFR or Prime rate floor where a spread is provided, unless noted. The spread provided includes PIK interest and other fee rates, if any.

(2)

Valued based on our accounting policy. The value of all securities was determined using significant unobservable inputs.

(3)

The provisions of the 1940 Act classify investments based on the level of control that we maintain in a particular portfolio company. As defined in the 1940 Act, a company is generally presumed to be “non-controlled” when we own 25% or less of the portfolio company’s voting securities and “controlled” when we own more than 25% of the portfolio company’s voting securities.

(4)

The provisions of the 1940 Act classify investments further based on the level of ownership that we maintain in a particular portfolio company. As defined in the 1940 Act, a company is generally deemed as “non-affiliated” when we own less than 5% of a portfolio company’s voting securities and “affiliated” when we own 5% or more of a portfolio company’s voting securities.

(5)

Non-U.S. company or principal place of business outside the United States.

(6)

Non-income producing securities.

(7)

The securities, or a portion thereof, are not 1) pledged as collateral under the Credit Facility and held through Funding I; or, 2) securing the 2031 Asset-Backed Debt and held through PennantPark CLO I, Ltd.

(8)

Investment is held through our Taxable Subsidiary.

(9)

Represents the purchase of a security with delayed settlement or a revolving line of credit that is currently an unfunded investment. This security does not earn a basis point spread above an index while it is unfunded.

(10)

The investment is treated as a non-qualifying asset under Section 55(a) of the 1940 Act. Under the 1940 Act, we may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of our total assets. As of December 31, 2023, qualifying assets represent 80% of our total assets and non-qualifying assets represent 20% of our total assets.

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS

September 30, 2023

(in thousands, except share data)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Investments in Non-Controlled, Non-Affiliated Portfolio Companies—118.1% (3), (4)
First Lien Secured Debt—101.9%
A1 Garage Merger Sub, LLC	12/22/2028	Commercial Services & Supplies		11.99	%	3M SOFR+660			1,520	$	1,499	$	1,512
A1 Garage Merger Sub, LLC - Unfunded Term Loan	12/22/2028	Commercial Services & Supplies		—			—		528		—		5
A1 Garage Merger Sub, LLC LLC (Revolver) (7), (9)	12/22/2028	Commercial Services & Supplies		—			—		748		—		(4	)
Ad.net Acquisition, LLC	05/07/2026	Media		11.65	%	3M SOFR+626			4,888		4,846		4,863
Ad.net Acquisition, LLC (Revolver) (7)	05/07/2026	Media		11.65	%	3M SOFR+626			622		622		619
Ad.net Acquisition, LLC (Revolver) (7), (9)	05/07/2026	Media		—			—		622		—		(3	)
Amsive Holding Corporation (f/k/a Vision Purchaser Corporation)	06/10/2025	Media		11.79	%	3M SOFR+640			13,958		13,859		13,749
Anteriad, LLC (f/k/a MeritDirect, LLC)	05/23/2024	Media		11.04	%	3M SOFR+565			13,786		13,755		13,545
Anteriad, LLC (f/k/a MeritDirect, LLC) - Incremental Term Loan	05/23/2024	Media		12.04	%	3M SOFR+665			2,212		2,186		2,184
Anteriad, LLC (f/k/a MeritDirect, LLC) (Revolver) (7), (9)	05/23/2024	Media		—			—		2,869		—		(50	)
Any Hour Services	07/21/2027	Energy Equipment and Services		11.22	%	3M SOFR+585			6,395		6,326		6,267
Any Hour Services (Revolver) (7), (9)	07/21/2027	Energy Equipment and Services		—			—		1,147		—		(23	)
Apex Service Partners, LLC	07/31/2025	Diversified Consumer Services		10.52	%	3M SOFR+525			6,160		6,132		6,145
Apex Service Partners, LLC Term Loan B	07/31/2025	Diversified Consumer Services		11.04	%	3M SOFR+550			294		294		294
Apex Service Partners, LLC Term Loan C	07/31/2025	Diversified Consumer Services		10.68	%	3M SOFR+525			12,826		12,732		12,793
Apex Service Partners, LLC (Revolver) (7)	07/31/2025	Diversified Consumer Services		10.86	%	3M SOFR+525			1,153		1,153		1,150
Apex Service Partners, LLC (Revolver) (7), (9)	07/31/2025	Diversified Consumer Services		—			—		692		—		(2	)
Applied Technical Services, LLC	12/29/2026	Commercial Services & Supplies		11.54	%	3M SOFR+615			8,891		8,784		8,714
Applied Technical Services, LLC (Unfunded Term Loan)	12/29/2026	Commercial Services & Supplies		—			—		582		—		(6	)
Applied Technical Services, LLC (Revolver) (7)	12/29/2026	Commercial Services & Supplies		13.25	%	3M SOFR+475			509		509		499
Applied Technical Services, LLC (Revolver) (7), (9)	12/29/2026	Commercial Services & Supplies		—			—		764		—		(15	)
Arcfield Acquisition Corp.	08/03/2029	Aerospace and Defense		11.62	%	1M SOFR+625			6,526		6,429		6,461
Arcfield Acquisition Corp. (Revolver) (9)	08/04/2028	Aerospace and Defense		—			—		1,379		—		(14	)
Beta Plus Technologies, Inc.	07/01/2029	Internet Software and Services		11.14	%	3M SOFR+575			4,950		4,862		4,604
BioDerm, Inc. (Revolver) (7)	01/31/2028	Healthcare Equipment and Supplies		11.81	%	1M SOFR+650			107		107		107
BioDerm, Inc. (Revolver) (9)	01/31/2028	Healthcare Equipment and Supplies		—			—		964		—		(5	)
Blackhawk Industrial Distribution, Inc.	09/17/2026	Distributors		11.79	%	3M SOFR+640			631		628		622
Blackhawk Industrial Distribution, Inc. - Unfunded Term Loan	09/17/2026	Distributors		—			—		2,624		—		(26	)
Blackhawk Industrial Distribution, Inc. (Revolver) (7)	09/17/2026	Distributors		13.75	%	3M SOFR+525			274		274		270
Blackhawk Industrial Distribution, Inc. (9)	09/17/2026	Distributors		—			—		2,469		—		(37	)
Broder Bros., Co.	12/04/2025	Textiles, Apparel and Luxury Goods		11.50	%	3M SOFR+626			3,324		3,324		3,324
By Light Professional IT Services, LLC	05/16/2025	High Tech Industries		12.43	%	3M SOFR+688			25,674		25,499		25,224
By Light Professional IT Services, LLC (Revolver) (7)(9)	05/16/2025	High Tech Industries		—			—		3,507		—		(61	)
Cadence Aerospace, LLC (7)	11/14/2023	Aerospace and Defense		12.07	%	3M SOFR+665			980		980		980
			(PIK 9.50%)
Cartessa Aesthetics, LLC	06/14/2028	Distributors		11.39	%	3M SOFR+600			13,076		12,907		13,076
Cartessa Aesthetics, LLC (Revolver) (7)	06/14/2028	Distributors		11.39	%	3M SOFR+600			511		511		511
Cartessa Aesthetics, LLC (Revolver) (7)(9)	06/14/2028	Distributors		—			—		927		—		-
CF512, Inc.	08/20/2026	Media		11.59	%	3M SOFR+619			5,980		5,930		5,860
CF512, Inc. (Revolver) (7), (9)	08/20/2026	Media		—			—		955		—		(19	)
CHA Holdings, Inc.	04/10/2025	Environmental Industries		10.15	%	3M SOFR+476			1,564		1,562		1,564
Challenger Performance Optimization, Inc.	08/31/2024	Business Services		12.18	%	3M L+675			237		237		230
Compex Legal Services, Inc.	02/09/2026	Professional Services		10.99	%	3M SOFR+525			8,925		8,891		8,925
Compex Legal Services, Inc. (Revolver) (7)	02/07/2025	Professional Services		10.94	%	3M SOFR+555			141		141		141
Compex Legal Services, Inc. (Revolver) (7), (9)	02/07/2025	Professional Services		—			—		1,265		—		—
Connatix Buyer, Inc.	07/13/2027	Media		11.16	%	1M SOFR+576			3,814		3,761		3,681
Connatix Buyer, Inc. (7), (9)	07/13/2027	Media		—			—		1,234		—		(43	)
Crane 1 Services, Inc.	08/16/2027	Commercial Services & Supplies		10.90	%	3M SOFR+551			882		871		878
Crane 1 Services, Inc. (Revolver) (7)	08/16/2027	Commercial Services & Supplies		10.90	%	3M SOFR+551			135		135		134
Crane 1 Services, Inc. (Revolver) (7)	08/16/2027	Commercial Services & Supplies		—			—		202		—		(1	)
Dr. Squatch, LLC	08/31/2027	Personal Products		11.24	%	3M SOFR+585			4,383		4,328		4,383
Dr. Squatch, LLC (Revolver) (7), (9)	08/31/2027	Personal Products		—			—		3,353		—		—
DRS Holdings III, Inc.	11/03/2025	Chemicals, Plastics and Rubber		11.79	%	3M SOFR+640			16,266		16,142		16,070
DRS Holdings III, Inc. (Revolver) (7), (9)	11/03/2025	Personal Products		—			—		1,426		—		(17	)
Duraco Specialty Tapes LLC	06/30/2024	Containers and Packaging		11.93	%	1M SOFR+650			3,445		3,407		3,393
ECL Entertainment, LLC	08/31/2030	Hotels, Restaurants and Leisure		10.14	%	1M SOFR+475			5,000		4,900		4,985
eCommission Financial Services, Inc. (10)	10/05/2023	Banking, Finance, Insurance & Real Estate		10.43	%	1M SOFR+510			4,599		4,599		4,599
eCommission Financial Services, Inc. (Revolver) (7), (9), (10)	10/05/2023	Banking, Finance, Insurance & Real Estate		—			—		5,000		—		—
EDS Buyer, LLC - Unfunded Term Loan	01/10/2029	Electronic Equipment, Instruments, and Components		—			—		6,750		—		(17	)
EDS Buyer, LLC. (Revolver) (7), (9)	01/10/2029	Electronic Equipment, Instruments, and Components		—			—		2,025		—		(30	)
Efficient Collaborative Retail Marketing Company, LLC	06/15/2024	Media: Diversified and Production		13.15	%	3M SOFR+776			7,645		7,651		5,352
ETE Intermediate II, LLC (Revolver) (9)	05/25/2029	Diversified Consumer Services		—			—		1,656		—		(28	)
Exigo Intermediate II, LLC (Revolver) (9)	03/15/2027	Software		—			—		689		—		(14	)
Five Star Buyer, Inc.	02/23/2028	Hotels, Restaurants and Leisure		12.43	%	1M SOFR+710			4,569		4,488		4,500
Five Star Buyer, Inc. - DDTL B Unfunded	02/23/2028	Hotels, Restaurants and Leisure		—			—		837		-		(13	)
Five Star Buyer, Inc. (Revolver) (9)	02/23/2028	Hotels, Restaurants and Leisure		—			—		741		-		(11	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

September 30, 2023

(in thousands, except share data)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Gauge ETE Blocker, LLC - Promissory Note	05/19/2029	Diversified Consumer Services		12.56	%		—		215	$	215	$	215
Global Holdings InterCo LLC	03/16/2026	Diversified Financial Services		11.96	%	3M SOFR+660			3,279		3,252		3,115
Graffiti Buyer, Inc.	08/10/2027	Trading Companies & Distributors		10.98	%	3M SOFR+550			736		729		729
Graffiti Buyer, Inc. (7), (9)	12/8/2023	Trading Companies & Distributors		—			—		332		—		—
Graffiti Buyer, Inc. (Revolver) (7)	08/10/2027	Trading Companies & Distributors		10.98	%	3M SOFR+575			269		269		266
Graffiti Buyer, Inc. (Revolver) (7), (9)	08/10/2027	Trading Companies & Distributors		—			—		596		—		(6	)
Hancock Roofing and Construction L.L.C.	12/31/2026	Insurance		10.93	%	3M SOFR+560			4,172		4,112		4,068
Hancock Roofing and Construction L.L.C. (Revolver) (7)	12/31/2026	Insurance		10.92	%	1M SOFR+560			335		335		327
Hancock Roofing and Construction L.L.C. (Revolver) (7), (9)	12/31/2026	Insurance		—			—		415		—		(10	)
Holdco Sands Intermediate, LLC	11/23/2028	Aerospace and Defense		11.32	%	6M SOFR+585			4,913		4,835		4,913
Holdco Sands Intermediate, LLC (Revolver) (9)	11/23/2027	Aerospace and Defense		—			—		1,791		—		—
HW Holdco, LLC	12/10/2024	Media		11.70	%	3M SOFR+640			9,000		8,973		8,865
HW Holdco, LLC (Revolver)	12/10/2024	Media		11.82	%	3M SOFR+640			116		116		114
HW Holdco, LLC (Revolver) (7), (9)	12/10/2024	Media		—			—		1,335		—		(20	)
IG Investments Holdings, LLC (7)	09/22/2028	Professional Services		11.45	%	3M SOFR+610			4,428		4,356		4,362
IG Investments Holdings, LLC (Revolver) (7), (9)	09/22/2027	Professional Services		—			—		477		—		(7	)
Imagine Acquisitionco, LLC (9)	11/15/2027	Software		—			—		1,657		—		(8	)
Imagine Acquisitionco, LLC (Revolver) (9)	11/15/2027	Software		—			—		1,193		—		(18	)
Inception Fertility Ventures, LLC	12/31/2024	Healthcare Providers and Services		12.50	%	3M SOFR+715			14,803		14,656		14,803
Infinity Home Services Holdco, Inc.	12/28/2028	Commercial Services & Supplies		12.24	%	3M SOFR+685			2,089		2,089		2,089
Infinity Home Services Holdco, Inc. - Unfunded Term Loan	12/28/2023	Commercial Services & Supplies		—			—		1,135		—		—
Infinity Home Services Holdco, Inc. (Revolver) (9)	12/28/2028	Commercial Services & Supplies		—			—		1,292		—		—
Infolinks Media Buyco, LLC	11/01/2026	Media		11.17	%	1M SOFR+585			3,178		3,143		3,178
Infolinks Media Buyco, LLC- Unfunded Term Loan	11/01/2023	Media		—			—		387		—		4
Integrated Data Services (Revolver) (9)	08/01/2029	Professional Services		—			—		3,096		—		(72	)
Integrative Nutrition, LLC	01/31/2025	Consumer Services		12.54	%	3M SOFR+715			15,521		15,457		14,590
Integrity Marketing Acquisition, LLC	08/27/2026	Insurance		11.57	%	3M SOFR+615			15,666		15,553		15,509
Integrity Marketing Acquisition, LLC - Unfunded Term Loan	08/31/2025	Insurance		—			—		8,000		-		(40	)
Integrity Marketing Acquisition, LLC (Revolver) (7), (9)	08/27/2026	Insurance		—			—		511		-		-
ITI Holdings, Inc. (Revolver)	03/03/2028	IT Services		12.05	%	1M SOFR+560			500		500		490
ITI Holdings, Inc. (Revolver) (9)	03/03/2028	IT Services		—			—		165		—		(3	)
Inventus Power, Inc.	06/30/2025	Electronic Equipment, Instruments, and Components		12.93	%	1M SOFR+761			4,988		4,894		4,888
Inventus Power, Inc. (Revolver) (7), (9)	06/30/2025	Electronic Equipment, Instruments, and Components		—			—		1,729		—		(35	)
K2 Pure Solutions NoCal, L.P. (Revolver) (7), (9)	12/20/2023	Chemicals, Plastics and Rubber		—			—		1,429		—		—
Kinetic Purchaser, LLC	11/10/2027	Personal Products		11.54	%	3M SOFR+615			17,253		16,999		16,995
Kinetic Purchaser, LLC - (Revolver) (9)	11/10/2026	Personal Products		—			—		3,435		—		(52	)
Lash OpCo, LLC	02/18/2027	Personal Products		11.88	%	1M SOFR+675			10,404		10,264		10,300
Lash OpCo, LLC (Revolver) (7)	08/16/2026	Personal Products		12.15	%	3M SOFR+675			2,086		2,086		2,065
Lash OpCo, LLC (Revolver) (7), (9)	08/16/2026	Personal Products		—			—		986		—		(10	)
LAV Gear Holdings, Inc.	10/31/2024	Capital Equipment		11.83	%	1M SOFR+643			7,544		7,537		7,454
			(PIK 5.50%)
LAV Gear Holdings, Inc. (Revolver) (7)	10/31/2024	Capital Equipment		11.02	%	3M SOFR+565			1,721		1,721		1,700
			(PIK 5.50%)
Ledge Lounger, Inc.	11/09/2026	Leisure Products		11.79	%	3M SOFR+640			3,709		3,677		3,663
Ledge Lounger, Inc. (Revolver) (9)	11/09/2026	Leisure Products		—			—		789		—		(10	)
Lightspeed Buyer Inc.	02/03/2026	Healthcare Technology		10.67	%	1M SOFR+535			22,543		22,282		22,317
Lightspeed Buyer Inc. (Revolver) (7) (9)	02/03/2026	Healthcare Technology		—			—		2,499		—		(25	)
LJ Avalon Holdings, LLC	02/01/2030	Construction & Engineering		11.79	%	3M SOFR+640			400		394		392
LJ Avalon Holdings, LLC - Unfunded Term Loan	07/31/2024	Construction & Engineering		—			—		2,424		—		(12	)
LJ Avalon Holdings, LLC (Revolver) (9)	01/31/2030	Construction & Engineering		—			—		1,130		—		(23	)
Loving Tan Intermediate II, Inc.	05/31/2028	Personal Products		12.39	%	3M SOFR+700			19,263		18,894		18,974
Loving Tan Intermediate II, Inc. (Revolver)	05/31/2028	Personal Products		12.39	%	3M SOFR+700			1,861		1,861		1,833
Loving Tan Intermediate II, Inc. (Revolver)(7)(9)	05/31/2028	Personal Products		—			—		1,523		—		(23	)
Lucky Bucks, LLC (6)	07/20/2027	Hotels, Restaurants and Leisure		0.00	%		—		4,489		4,210		1,182
Lucky Bucks, LLC - DIP	10/20/2023	Hotels, Restaurants and Leisure		15.30	%	3M SOFR+1000			160		158		160
MAG DS Corp.	04/01/2027	Aerospace and Defense		10.99	%	3M SOFR+550			3,674		3,564		3,481
Mars Acquisition Holdings Corp.	05/14/2026	Media		11.04	%	3M SOFR+565			8,728		8,616		8,640
Mars Acquisition Holdings Corp. (Revolver)(7)(9)	05/14/2026	Media		—			—		2,435		—		(24	)
MBS Holdings, Inc. (Revolver)	04/16/2027	Internet Software and Services		11.17	%	1M SOFR+585			185		185		182
MBS Holdings, Inc. (Revolver)(7)(9)	04/16/2027	Internet Software and Services		—			—		972		—		(15	)
MDI Buyer, Inc.	07/25/2028	Commodity Chemicals		11.09	%	3M SOFR+625			2,041		2,003		1,997
MDI Buyer, inc. (Revolver) (7)	07/25/2028	Commodity Chemicals		10.91	%	3M SOFR+600			361		361		353
MDI Buyer, inc. (Revolver) (9)	07/25/2028	Commodity Chemicals		—			—		412		—		(5	)
Meadowlark Acquirer, LLC	12/10/2027	Professional Services		11.04	%	3M SOFR+565			1,978		1,954		1,929
Meadowlark Acquirer, LLC - Term Loan I (9)	12/10/2027	Professional Services		—			—		1,103		—		(17	)
Meadowlark Acquirer, LLC - Term Loan II (9)	12/10/2027	Professional Services		—			—		9,483		—		(142	)
Meadowlark Acquirer, LLC (Revolver) (9)	12/10/2027	Professional Services		—			—		1,693		—		(42	)
Mission Critical Electronics, Inc.	03/28/2024	Capital Equipment		10.65	%	SOFR +515			3,571		3,560		3,553
Mission Critical Electronics, Inc. (9)	03/28/2024	Capital Equipment		—			—		707		—		(1	)
Mission Critical Electronics, Inc. (Revolver) (7), (9)	03/28/2024	Capital Equipment		—			—		1,325		—		(6	)
Municipal Emergency Services, Inc.	10/01/2027	Distributors		11.04	%	3M SOFR+565			1,181		1,144		1,155
Municipal Emergency Services, Inc. - Unfunded Term Loan A	06/16/2023	Distributors		—			—		387		—		(9	)
Municipal Emergency Services, Inc. - Unfunded Term Loan B	12/16/2024	Distributors		—			—		1,264		—		(28	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

September 30, 2023

(in thousands, except share data)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Municipal Emergency Services, Inc. (Revolver) (7)	10/01/2027	Distributors		11.04	%	3M SOFR+565			379	$	379	$	370
Municipal Emergency Services, Inc. (Revolver) (7), (9)	10/01/2027	Distributors		—			—		568		—		(12	)
Neptune Flood Incorporated - Revolver Unfunded	05/09/2029	Insurance		—			—		541		—		—
NBH Group LLC (Revolver) (7), (9)	08/19/2026	Healthcare Equipment and Supplies		—			—		1,677		—		(34	)
NORA Acquisition, LLC	08/31/2029	Healthcare Providers and Services		11.74	%	3M SOFR+635			41,489		40,662		40,659
NORA Acquisition, LLC (Revolver) (7), (9)	08/31/2029	Healthcare Providers and Services		—			—		5,479		—		(110	)
One Stop Mailing, LLC	05/07/2027	Air Freight and Logistics		11.68	%	1M SOFR+636			8,516		8,397		8,516
ORL Acquisition, Inc. (7)	09/03/2027	Consumer Finance		12.84	%	6M SOFR+725			4,900		4,828		4,459
ORL Acquisition, Inc. (Revolver) (7), (9)	09/03/2027	Consumer Finance		—			—		861		—		(77	)
Output Services Group, Inc. (6)	06/27/2026	Business Services		0.00	%		—		4,923		4,469		960
Owl Acquisition, LLC	02/04/2028	Professional Services		10.80	%	6M SOFR+550			3,893		3,797		3,834
Ox Two, LLC	05/18/2026	Construction and Building		12.90	%	3M SOFR+751			22,736		22,513		22,338
Ox Two, LLC (Revolver) (9)	05/18/2026	Construction and Building		—			—		3,387		—		(59	)
Pequod Merger Sub, Inc. - Unfunded Term Loan	12/02/2026	Diversified Financial Services		—			—		2,847		—		(57	)
Pequod Merger Sub, Inc (Revolver) (9)	12/02/2026	Diversified Financial Services		—			—		757		—		(15	)
PL Acquisitionco, LLC	11/09/2027	Textiles, Apparel and Luxury Goods		12.42	%	1M SOFR+710			5,612		5,538		5,050
PL Acquisitionco, LLC - (Revolver) (9)	11/09/2027	Textiles, Apparel and Luxury Goods		—			—		2,290		—		(229	)
PlayPower, Inc.	05/08/2026	Leisure Products		10.92	%	3M SOFR+565			3,401		3,386		3,248
Pragmatic Institute, LLC - Unfunded Term Loan	07/06/2028	Professional Services		—			—		2,290		—		(80	)
Pragmatic Institute, LLC (Revolver)	07/06/2028	Professional Services		11.17	%	3M SOFR+575			1,526		1,526		1,458
Quantic Electronics, LLC	11/19/2026	Electronic Equipment, Instruments, and Components		11.74	%	3M SOFR+635			6,647		6,578		6,547
Quantic Electronics, LLC (Revolver) (7)	11/19/2026	Electronic Equipment, Instruments, and Components		11.74	%	3M SOFR+635			670		670		660
Questex, LLC	09/09/2024	Media: Diversified and Production		9.81	%	3M SOFR+425			6,731		6,706		6,731
Questex, LLC (Revolver) (7), (9)	09/09/2024	Media: Diversified and Production		—			—		1,197		—		-
Rancho Health MSO, Inc. (Revolver) (7)	12/18/2025	Healthcare Equipment and Supplies		11.24	%	3M SOFR+585			210		210		210
Rancho Health MSO, Inc. (Revolver) (7), (9)	12/18/2025	Healthcare Equipment and Supplies		—			—		315		—		—
Recteq, LLC	01/29/2026	Leisure Products		12.54	%	3M SOFR+715			1,463		1,448		1,419
Recteq, LLC (Revolver) (7), (9)	01/29/2026	Leisure Products		—			—		1,296		—		(39	)
Research Now Group, Inc. and Dynata, LLC	12/20/2024	Business Services		11.13	%	3M SOFR+576			16,962		16,875		14,842
Riverpoint Medical, LLC	06/20/2025	Healthcare Equipment and Supplies		10.54	%	3M SOFR+515			7,939		7,903		7,828
Riverpoint Medical, LLC (Revolver) (7)	06/20/2025	Healthcare Equipment and Supplies		10.42	%	1M SOFR+510			114		114		112
Riverpoint Medical, LLC (Revolver) (7), (9)	06/20/2025	Healthcare Equipment and Supplies		—			—		795		—		(11	)
Riverside Assessments, LLC	03/10/2025	Professional Services		11.29	%	3M SOFR+590			15,199		15,075		15,047
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.) - Unfunded Term Loan	06/15/2029	Professional Services		—			—		1,146		—		—
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.) (Revolver) (7), (9)	06/15/2029	Professional Services		—			—		860		—		(13	)
Sales Benchmark Index LLC	01/03/2025	Professional Services		11.59	%	3M SOFR+620			2,596		2,581		2,583
Sales Benchmark Index LLC (Revolver) (7), (9)	01/03/2025	Professional Services		—			—		1,293		—		(7	)
Sargent & Greenleaf Inc.	12/20/2024	Electronic Equipment, Instruments, and Components		12.93	%	1M SOFR+760			3,439		3,425		3,405
Sargent & Greenleaf Inc. (Revolver)	12/20/2024	Electronic Equipment, Instruments, and Components		12.92	%	1M SOFR+760			280		280		277
Sargent & Greenleaf Inc. (Revolver) (9)	12/20/2024	Electronic Equipment, Instruments, and Components		—			—		801		—		(8	)
Schlesinger Global, Inc.	07/14/2025	Professional Services		12.07	%	3M SOFR + 715			14,490		14,428		14,019
Schlesinger Global, Inc. (Revolver)	07/14/2025	Professional Services		12.52	%	3M SOFR+715			1,495		1,495		1,446
Schlesinger Global, Inc. (Revolver) (7), (9)	07/14/2025	Professional Services		—			—		375		—		(12	)
Seaway Buyer, LLC	06/13/2029	Chemicals, Plastics and Rubber		11.54	%	3M SOFR+615			1,921		1,895		1,863
Sigma Defense Systems, LLC	12/18/2025	IT Services		14.04	%	3M SOFR+865			10,277		10,123		10,123
Sigma Defense Systems, LLC (Revolver) (7)	12/18/2025	IT Services		14.04	%	3M SOFR+865			1,835		1,835		1,807
Sigma Defense Systems, LLC (Revolver) (7), (9)	12/18/2025	IT Services		—			—		786		—		(12	)
Signature Systems Holding Company	05/03/2024	Commercial Services & Supplies		12.04	%	1M L+665			9,708		9,688		9,708
Signature Systems Holding Company (Revolver) (9)	05/03/2024	Commercial Services & Supplies		—			—		1,747		—		—
Skopima Consilio Parent, LLC	05/17/2028	Business Services		9.93	%	1M SOFR+450			600		588		587
Smile Brands Inc.	10/14/2025	Healthcare and Pharmaceuticals		9.97	%	3M SOFR+450			2,437		2,437		2,190
Smile Brands Inc. (Revolver)	10/14/2025	Healthcare and Pharmaceuticals		10.11	%	1M SOFR+450			1,508		1,508		1,355
Smile Brands Inc. LC (Revolver) (7), (9)	10/14/2025	Healthcare and Pharmaceuticals		—			—		108		—		(11	)
Solutionreach, Inc.	01/17/2024	Healthcare Technology		12.37	%	1M SOFR+700			4,657		4,650		4,638
Solutionreach, Inc. (Revolver) (7), (9)	01/17/2024	Healthcare Technology		—			—		833		—		(3	)
Spendmend Holdings LLC	03/01/2028	Healthcare Technology		11.03	%	SOFR + 565			2,061		2,037		2,016
Spendmend Holdings LLC - Unfunded Term Loan	03/01/2024	Healthcare Technology		—			—		1,707		—		(25	)
Spendmend Holdings LLC (Revolver)	03/01/2028	Healthcare Technology		11.03	%	1M SOFR+565			357		357		349
Spendmend Holdings LLC (Revolver) (9)	03/01/2028	Healthcare Technology		—			—		535		—		(12	)
STV Group Incorporated	12/11/2026	Construction & Engineering		10.67	%	1M SOFR+535			4,752		4,724		4,657
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)	08/16/2027	Aerospace and Defense		11.49	%	6M SOFR+615			18,373		18,109		18,171
System Planning and Analysis, Inc. (Revolver) (9) (f/k/a Management Consulting & Research, LLC)	08/16/2027	Aerospace and Defense		—			—		5,188		—		(57	)
Teneo Holdings LLC	07/18/2025	Diversified Financial Services		10.67	%	1M SOFR+535			5,733		5,683		5,725
The Aegis Technologies Group, LLC	10/31/2025	Aerospace and Defense		12.04	%	3M SOFR+665			5,421		5,374		5,340
The Bluebird Group LLC	07/28/2026	Professional Services		12.79	%	3M SOFR+740			2,368		2,331		2,359
The Bluebird Group LLC (Revolver) (7), (9)	07/28/2026	Professional Services		—			—		862		—		(3	)
The Vertex Companies, LLC (7)	08/30/2027	Construction & Engineering		11.67	%	1M SOFR+635			1,979		1,949		1,961
The Vertex Companies, LLC (Revolver)	08/30/2027	Construction & Engineering		11.67	%	1M SOFR+635			305		305		303
The Vertex Companies, LLC (Revolver) (7), (9)	08/30/2027	Construction & Engineering		—			—		606		—		(5	)
TPC Canada Parent, Inc. and TPC US Parent, LLC (5), (10)	11/24/2025	Food Products		10.90	%	3M SOFR+565			4,813		4,793		4,813
TWS Acquisition Corporation	06/16/2025	Diversified Consumer Services		11.81	%	3M SOFR+640			4,316		4,280		4,316
TWS Acquisition Corporation (Revolver) (7), (9)	06/16/2025	Diversified Consumer Services		—			—		2,628		—		—
Tyto Athene, LLC	04/01/2028	IT Services		10.90	%	3M SOFR+565			11,928		11,803		10,879
Tyto Athene, LLC (Revolver) (7), (9)	04/01/2026	IT Services		—			—		1,040		—		(94	)

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

September 30, 2023

(in thousands, except share data)


Issuer Name	Maturity		Industry	Current Coupon				Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Walker Edison Furniture, LLC - Term Loan	03/31/2027		Wholesale		12.18	%		1M SOFR+685			3,521	$	3,521	$	3,521
Walker Edison Furniture Company, LLC - Funded Junior Revolver	03/31/2027		Wholesale		11.68	%		1M SOFR+635			1,667		1,667		1,667
Walker Edison Furniture Company, LLC - Unfunded Term Loan	03/31/2027		Wholesale		—				—		333		—		—
Wildcat Buyerco, Inc.	02/27/2026		Electronic Equipment, Instruments, and Components		10.54	%		3M SOFR+515			7,646		7,579		7,570
Wildcat Buyerco, Inc. (Revolver) (9)	02/27/2026		Electronic Equipment, Instruments, and Components		—				—		534		—		(5	)
Zips Car Wash, LLC	03/01/2024		Automobiles		12.67	%		1M SOFR+735			13,249		13,206		12,818
Total First Lien Secured Debt													683,940		665,725
Second Lien Secured Debt—0.0%
Mailsouth Inc. (7)	04/23/2025		Media: Advertising, Printing and Publishing		—		(6)		—		1,161		965		-
QuantiTech LLC	02/04/2027		Aerospace and Defense		15.50	%		3M SOFR+1,010			150		148		149
Total Second Lien Secured Debt													1,113		149
Preferred Equity— 1.8% (6)
Ad.net Holdings, Inc. (7)		—	Media		—				—		6,720		672		757
Anteriad Holdings, LP (f/k/a MeritDirect Holdings, LP) (7), (8)		—	Media		—				—		2,018		2,018		1,633
Cartessa Aesthetics, LLC (Preferred) (8)		—	Distributors		—				—		1,437,500		1,438		2,007
Gauge Lash Coinvest LLC (Preferred)		—	Personal Products		—				—		108,546		586		1,319
Gauge Schlesinger Coinvest LLC (Preferred Equity)		—	Professional Services		—				—		64		64		47
Imagine Topco, LP		—	Software		8.00	%			—		1,236,027		1,236		1,246
Magnolia Topco LP - Class A Preferred Equity (8)		—	Automobiles		—				—		5		5		6
Magnolia Topco LP - Class B Preferred Equity (8)		—	Automobiles		—				—		28		17		24
Mars Intermediate Holdings II, Inc. (7)		—	Media		—				—		835		835		1,112
NXOF Holdings, Inc. (Tyto Athene, LLC) (7)		—	IT Services		—				—		733		733		489
ORL Holdco, Inc. (7)		—	Consumer Finance		—				—		1,327		133		-
PL Acquisitionco, LLC (Preferred Equity)		—	Textiles, Apparel and Luxury Goods		—				—		61		61		66
Signature CR Intermediate Holdco, Inc. (7)		—	Commercial Services & Supplies		12.00	%			—		1,323		1,323		2,158
TPC Holding Company, LP (5), (7), (8), (10)		—	Food Products		—				—		409		409		598
TWD Parent Holdings, LLC (The Vertex Companies, LLC) (7)		—	Construction & Engineering		—				—		37		35		45
UniTek Global Services, Inc. -		—	Telecommunications		20.00	%			—		343,861		344		64
Super Senior Preferred Equity (7)
UniTek Global Services, Inc. - Senior Preferred Equity (7)		—	Telecommunications		19.00	%			—		448,851		449		—
UniTek Global Services, Inc. (7)		—	Telecommunications		13.50	%			—		1,047,317		670		—
Total Preferred Equity													11,028		11,571
Common Equity/Warrants— 14.5% (6)
A1 Garage Equity, LLC(8)		—	Commercial Services & Supplies		—				—		647,943		648		691
Ad.net Holdings, Inc. (7)		—	Media		—				—		7,467		75		—
Affinion Group Holdings, Inc. (Warrants)	04/10/2024		Consumer Goods: Durable		—				—		8,893		245		—
AG Investco LP (7), (8)		—	Software		—				—		805,164		805		1,074
AG Investco LP (7), (8), (9)		—	Software		—				—		194,836		—		—
Altamira Intermediate Company II, Inc. (7)		—	IT Services		—				—		1,437,500		1,437		1,456
Anteriad Holdings, LP (f/k/a MeritDirect Holdings, LP) (7), (8)		—	Media		—				—		2,018		—		—
Athletico Holdings, LLC (8)		—	Healthcare Providers and Services		—				—		4,678		5,000		4,516
BioDerm Holdings, LP		—	Healthcare Equipment and Supplies		—				—		1,313		1,313		1,514
Burgess Point Holdings, LP		—	Auto Components		—				—		100		100		109
By Light Investco LP (7), (8)		—	High Tech Industries		—				—		22,789		849		11,610
Connatix Parent, LLC (7)		—	Media		—				—		38,278		421		222
Crane 1 Acquisition Parent Holdings, L.P. (7)		—	Commercial Services & Supplies		—				—		130		120		199
Delta InvestCo LP (Sigma Defense Systems, LLC) (7), (8)		—	IT Services		—				—		760,273		747		1,358
Delta InvestCo LP (Sigma Defense Systems, LLC) (7), (8),(9)		—	IT Services		—				—		244,597		—		—
eCommission Holding Corporation (7), (10)		—	Banking, Finance, Insurance & Real Estate		—				—		20		251		463
EDS Topco, LP		—	Electronic Equipment, Instruments, and Components		—				—		1,125,000		1,125		1,062
Exigo, LLC		—	Software		—				—		541,667		542		612
FedHC InvestCo LP (7),(8)		—	Aerospace and Defense		—				—		21,665		727		3,062
FedHC InvestCo LP (7),(8),(9)		—	Aerospace and Defense		—				—		7,566		—		—
Five Star Parent Holdings, LLC		—	Hotels, Restaurants and Leisure		—				—		655,714		656		800
Gauge ETE Blocker, LLC		—	Diversified Consumer Services		—				—		374,444		374		371
Gauge Lash Coinvest LLC (7)		—	Personal Products		—				—		1,485,953		227		6,810
Gauge Loving Tan, LP		—	Personal Products		—				—		2,481,781		2,482		2,088
Gauge Schlesinger Coinvest LLC (7)		—	Professional Services		—				—		465		476		344
Gauge TVC Coinvest, LLC (TVC Enterprises, LLC) (7)		—	Professional Services		—				—		391,144		—		1,153
GCOM InvestCo LP (7)		—	IT Services		—				—		19,184		3,342		3,165
Go Dawgs Capital III, LP		—	Building Products		—				—		324,675		325		711
(American Insulated Glass, LLC) (7), (8)
Hancock Claims Consultants Investors, LLC (7), (8)		—	Insurance		—				—		450,000		448		338
HPA SPQ Aggregator LP		—	Professional Services		—				—		750,399		750		751
HV Watterson Holdings, LLC		—	Professional Services		—				—		100,000		100		111
Icon Partners V C, L.P.		—	Internet Software and Services		—				—		1,863,863		1,864		1,671
Icon Partners V C, L.P. (7), (9)		—	Internet Software and Services		—				—		636,137		—		(66	)
IIN Group Holdings, LLC		—	Consumer Services		—				—		1,000		1,000		—
(Integrative Nutrition, LLC) (7), (8)
Imagine Topco, LP (Common)		—	Software		—				—		1,236,027		—		—
IHS Parent Holdngs, L.P.		—	Commercial Services & Supplies		—				—		1,218,045		1,218		1,642
Ironclad Holdco, LLC (Applied Technical Services, LLC) (7), (8)		—	Commercial Services & Supplies		—				—		5,811		573		844

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

CONSOLIDATED SCHEDULE OF INVESTMENTS—(Continued)

September 30, 2023

(in thousands, except share data)


Issuer Name	Maturity		Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
ITC Infusion Co-invest, LP (8)		—	Healthcare Equipment and Supplies		—			—		116,032	$	1,160	$	1,268
ITC Rumba, LLC (Cano Health, LLC) (7),(8)		—	Healthcare and Pharmaceuticals		—			—		46,763		117		144
Kentucky Racing Holdco, LLC (8)		—	Hotels, Restaurants and Leisure		—			—		87,345		—		883
Kinetic Purchaser, LLC		—	Personal Products		—			—		1,734,775		1,735		2,508
KL Stockton Co-Invest LP (Any Hour Services) (7),(8)		—	Energy Equipment and Services		—			—		382,353		382		775
Lightspeed Investment Holdco LLC (7)		—	Healthcare Technology		—			—		585,587		586		1,588
LJ Avalon, LP		—	Construction & Engineering		—			—		1,638,043		1,638		1,736
Magnolia Topco LP - Class A Common Equity (8)		—	Automobiles		—			—		5,144		—		—
Magnolia Topco LP - Class B Common Equity (8)		—	Automobiles		—			—		28,231		—		—
Mars Intermediate Holdings II, Inc. (7)		—	Media		—			—		835		—		468
MDI Aggregator, LP		—	Commodity Chemicals		—			—		10,761		1,077		1,155
Meadowlark Title, LLC (8)		—	Professional Services		—			—		819,231		805		—
MSpark, LLC		—	Media: Advertising, Printing and Publishing		—			—		3,988		1,287		—
Municipal Emergency Services, Inc. (7)		—	Distributors		—			—		1,973,370		2,005		2,230
NEPRT Parent Holdings, LLC (Recteq, LLC) (7), (8)		—	Leisure Products		—			—		1,494		1,448		101
NORA Parent Holdings, LLC		—	Healthcare Providers and Services		—			—		2,544		2,544		2,544
North Haven Saints Equity Holdings, LP (8)		—	Healthcare Technology		—			—		223,602		224		223
NXOF Holdings, Inc. (Tyto Athene, LLC) (7)		—	IT Services		—			—		14,960		15		—
OceanSound Discovery Equity, LP (Holdco Sands Intermediate, LLC) (7), (8)		—	Aerospace and Defense		—			—		173,638		1,614		3,768
OHCP V BC COI, L.P.		—	Distributors		—			—		743,750		744		650
OHCP V BC COI, L.P. (9)		—	Distributors		—			—		506,250		—		(64	)
ORL Holdco, Inc. (7)		—	Consumer Finance		—			—		1,474		15		—
PennantPark-TSO Senior Loan Fund, LP (7)		—	Financial Services		—			—		11,167,847		11,168		9,345
LEP Pequod Holdings, LP		—	Financial Services		—			—		350		865		1,006
Pink Lily Holdco, LLC (PL Acquisitions, LLC) (8)		—	Textiles, Apparel and Luxury Goods		—			—		1,735		1,735		55
Pragmatic Institute, LLC		—	Professional Services		—			—		610,583		611		238
Quad (U.S.) Co-Invest, L.P.			Professional Services		—			—		266,864		267		312
QuantiTech InvestCo LP (7), (8)		—	Aerospace and Defense		—			—		712		68		446
QuantiTech InvestCo LP (7), (8), (9)		—	Aerospace and Defense		—			—		955		—		—
QuantiTech InvestCo II LP (7), (8),		—	Aerospace and Defense		—			—		40		24		26
RFMG Parent, LP (Rancho Health MSO, Inc.) (7)		—	Healthcare Equipment and Supplies		—			—		1,050,000		1,050		1,052
SBI Holdings Investments LLC (Sales Benchmark Index LLC) (7)		—	Professional Services		—			—		64,634		646		515
Seaway Topco, LP			Chemicals, Plastics and Rubber		—			—		296		296		235
Signature CR Intermediate Holdco, Inc. (7)		—	Commercial Services & Supplies		—			—		70		70		1,784
SP L2 Holdings, LLC (Ledge Lounger, Inc.)		—	Leisure Products		—			—		360,103		360		247
SSC Dominion Holdings, LLC		—	Capital Equipment		—			—		24		23		1,098
Class B (US Dominion, Inc.) (7)
StellPen Holdings, LLC (CF512, Inc.) (7)		—	Media		—			—		161,538		161		178
TAC LifePort Holdings, LLC (7),(8)		—	Aerospace and Defense		—			—		533,833		524		850
Tower Arch Infolinks Media, LP (Infolinks Media Buyco, LLC)(8)		—	Media		—			—		219,056		206		388
Tower Arch Infolinks Media, LP (Infolinks Media Buyco, LLC)(8) (9)		—	Media		—			—		146,550		—		—
TPC Holding Company, LP (5), (7), (8), (10)		—	Food Products		—			—		21,527		21		212
TWD Parent Holdings, LLC (The Vertex Companies, LLC) (7)		—	Construction & Engineering		—			—		749		1		1
UniTek Global Services, Inc.(C)		—	Telecommunications		—			—		213,739		—		—
UniTek Global Services, Inc. (W)		—	Telecommunications		—			—		23,889		—		—
UniVista Insurance (7),(8)		—	Insurance		—			—		400		362		555
Urology Partners Co., L.P.		—	Healthcare Providers and Services		—			—		694,444		694		653
Walker Edison Holdco LLC		—	Healthcare Providers and Services		—			—		36,458		3,393		1,766
WCP IvyRehab QP CF Feeder, LP(8)		—	Healthcare Providers and Services		—			—		3,715,012		3,754		4,319
WCP IvyRehab QP CF Feeder, LP (8), (9)		—	Healthcare Providers and Services		—			—		284,988		—		—
Wildcat Parent, LP (Wildcat Buyerco, Inc.) (7)		—	Electronic Equipment, Instruments, and Components		—			—		2,240		224		794
Total Common Equity/Warrants												72,159		94,733
Total Investments in Non-Controlled, Non-Affiliated Portfolio Companies												768,240		772,178
Investments in Controlled, Affiliated Portfolio Companies—45.1% (3), (4)
First Lien Secured Debt—36.8%
Marketplace Events, LLC - Super Priority First Lien Term Loan (7)	09/30/2025		Media: Diversified and Production		10.94	%	3M SOFR+550			3,582		3,582		3,582
Marketplace Events, LLC - Super Priority First Lien (7), (9)	09/30/2025		Media: Diversified and Production		—			—		3,261		—		—
Marketplace Events, LLC	09/30/2026		Media: Diversified and Production		10.94	%	3M SOFR+550			26,771		20,931		26,770
PennantPark Senior Secured Loan Fund I LLC (7), (9), (10)	05/06/2024		Financial Services		13.33	%	3M SOFR+800			210,088		210,088		210,088
Total First Lien Secured Debt												234,601		240,440
Equity Interests—8.3%
New MPE Holdings, LLC (Marketplace Events, LLC) (7),(8)		—	Media: Diversified and Production		—			—		349		—		3,675
PennantPark Senior Secured Loan Fund I LLC (7), (9), (10)		—	Financial Services		—			—		90,038		90,038		50,881
Total Equity Interests												90,038		54,556
Total Investments in Controlled, Affiliated Portfolio Companies												324,639		294,996
Total Investments—163.3%												1,092,878		1,067,174
Cash and Cash Equivalents—15.3%
Money Market - BlackRock Federal FD Institutional 30												100,555		100,555
Total Cash and Cash Equivalents												100,555		100,555
Total Investments and Cash Equivalents—178.6%											$	1,193,433	$	1,167,729
Liabilities in Excess of Other Assets—(78.6)%														(514,124	)
Net Assets—100.0%													$	653,605

(1)

Represents floating rate instruments that accrue interest at a predetermined spread relative to an index, typically the applicable Secured Overnight Financing Rate, or “SOFR”, or Prime rate, or “P, or
Sterling Overnight Index Average, or “SONIA.” The spread may change based on the type of rate used. The terms in the Schedule of Investments disclose the actual interest rate in effect as of the reporting
period. SOFR loans are typically indexed to a 30-day, 90-day or 180-day SOFR rates (1M S, 3M S, or 6M S, respectively) at the borrower’s option. SONIA loans are typically indexed daily for GBP loans
with a quarterly frequency payment. All securities are subject to a SOFR or Prime rate floor where a spread is provided, unless noted. The spread provided includes PIK interest and other fee rates, if any.

(2)

Valued based on our accounting policy. The value of all securities was determined using significant unobservable inputs.

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(3)

The provisions of the 1940 Act classify investments based on the level of control that we maintain in a particular portfolio company. As defined in the 1940 Act, a company is generally presumed to be
“non-controlled” when we own 25% or less of the portfolio company’s voting securities and “controlled” when we own more than 25% of the portfolio company’s voting securities.

(4)

The provisions of the 1940 Act classify investments further based on the level of ownership that we maintain in a particular portfolio company. As defined in the 1940 Act, a company is generally deemed
as “non-affiliated” when we own less than 5% of a portfolio company’s voting securities and “affiliated” when we own 5% or more of a portfolio company’s voting securities.

(5)

Non-U.S. company or principal place of business outside the United States.

(6)

Non-income producing securities.

(7)

The securities, or a portion thereof, are not 1) pledged as collateral under the Credit Facility and held through Funding I; or 2) securing the 2031 Asset-Backed Debt and held through
PennantPark CLO I, Ltd.

(8)

Investment is held through our Taxable Subsidiary.

(9)

(10)

The investment is treated as a non-qualifying asset under Section 55(a) of the 1940 Act. Under the 1940 Act, we may not acquire any non-qualifying asset unless, at the time the acquisition is made, qualifying assets represent at least 70% of our total assets. As of September 30, 2023, qualifying assets represent 76% of our total assets and non-qualifying assets represent 24% of our total assets.

SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2023

(Unaudited)

1. ORGANIZATION

PennantPark Floating Rate Capital Ltd. was organized as a Maryland corporation in October 2010. We are a closed-end, externally managed, non-diversified investment company that has elected to be treated as a BDC under the 1940 Act.

Our investment objectives are to generate both current income and capital appreciation while seeking to preserve capital. We seek to achieve our investment objective by investing primarily in floating rate loans, and other investments made to U.S. middle-market private companies whose debt is rated below investment grade. Floating rate loans pay interest at variable rates, which are determined periodically, on the basis of a floating base lending rate such as SOFR, with or without a floor, plus a fixed spread. Under normal market conditions, we generally expect that at least 80% of the value of our managed assets will be invested in floating rate loans and other investments bearing a variable rate of interest, which may include, from time to time, variable rate derivative instruments. We generally expect that first lien secured debt will represent at least 65% of our overall portfolio. We generally expect to invest up to 35% of our overall portfolio opportunistically in other types of investments, including second lien secured debt, subordinated debt, and, to a lesser extent, equity investments.

We have entered into an investment management agreement, or (the "Investment Management Agreement"), with PennantPark Investment Advisers LLC (the "Investment Adviser"), an external adviser that manages our day-to-day operations. We have also entered into an administration agreement, or (the "Administration Agreement"), with PennantPark Investment Administration LLC (the "Administrator"), which provides the administrative services necessary for us to operate.

Funding I, our wholly-owned subsidiary and a special purpose entity, was organized in Delaware as a limited liability company in May 2011. We formed Funding I in order to establish a credit facility. The Investment Adviser serves as the collateral manager to Funding I and has irrevocably directed that any management fee owed with respect to such services is to be paid to us so long as the Investment Adviser remains the collateral manager. This arrangement does not increase our consolidated management fee.

We have formed and expect to continue to form certain taxable subsidiaries, including the Taxable Subsidiary, which are subject to tax as corporations. These taxable subsidiaries allow us to hold equity securities of certain portfolio companies treated as pass-through entities for U.S. federal income tax purposes while facilitating our ability to qualify as a RIC under the Code.

On April 14, 2022, listing and trading of the Company's common stock commenced on the New York Stock Exchange after the Company voluntarily withdrew the principal listing of its common stock from the Nasdaq Stock Market LLC effective at market close on April 13, 2022.

In May 2017, we and a subsidiary of Kemper Corporation (NYSE: KMPR), Trinity Universal Insurance Company, or Kemper, formed PSSL, an unconsolidated joint venture. PSSL invests primarily in middle-market and other corporate debt securities consistent with our strategy. PSSL was formed as a Delaware limited liability company. See Note 4.

In November 2017, we issued $138.6 million of our 2023 Notes. The principal on the 2023 Notes were payable in four annual installments as follows: 15% of the original principal amount on December 15, 2020, 15% of the original principal amount on December 15, 2021, 15% of the original principal amount on December 15, 2022 and 55% on December 15, 2023. On December 15, 2023, the remaining 2023 Notes were repaid in full. The 2023 Notes were general, unsecured obligations and ranked equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2023 Notes were listed on the TASE. In connection with this offering, we have dual listed our common stock on the TASE.

In September 2019, the Securitization Issuers completed the Debt Securitization. The 2031 Asset-Backed Debt is secured by a diversified portfolio of the Securitization Issuer consisting primarily of middle market loans and participation interests in middle market loans. The 2031 Asset-Backed Debt is scheduled to mature on October 15, 2031. On the closing date of the Debt Securitization, in consideration of our transfer to the Securitization Issuer of the initial closing date loan portfolio, which included loans distributed to us by certain of our wholly-owned subsidiaries, the Securitization Issuer transferred to us 100% of the Preferred Shares of the Securitization Issuer, 100% of the Class D Secured Deferrable Floating Rate Notes issued by the Securitization Issuer, and a portion of the net cash proceeds received from the sale of the 2031 Asset-Backed Debt. See Note 10.

In March 2021 and October 2021, we issued $100.0 million and $85.0 million, respectively, in aggregate principal amount of our 2026 Notes at a public offering price per note of 99.4% and 101.5% respectively. Interest on the 2026 Notes is paid semi-annually on April 1 and October 1 of each year, at a rate of 4.25% per year, commencing October 1, 2021. The 2026 Notes mature on April 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes are general, unsecured obligations and rank equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2026 Notes are effectively subordinated to our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes on any securities exchange or automated dealer quotation system.

In April 2021, we formed PennantPark-TSO Senior Loan Fund LP ("PTSF"), an unconsolidated limited partnership, organized as a Delaware limited liability partnership. We sold $81.4 million in investments to a wholly-owned subsidiary of PTSF in exchange for cash in the amount of $69.5 million and an $11.9 million equity interest in PTSF representing 23.08% of the total outstanding Class A Units of PTSF. We recognized $0.4 million of realized gain upon the formation of PTSF. As of December 31, 2023, our capital commitment of $15.3 million is fully funded and we hold 23.08% of the total outstanding Class A Units of PTSF and a 4.99% voting interest in the general partner which manages PTSF.

We are operated by a person who has claimed an exclusion from the definition of the term “commodity pool operator” under the Commodity Exchange Act of 1936, as amended, or the Commodity Exchange Act, and therefore, is not subject to registration or regulation as a commodity pool operator under the Commodity Exchange Act.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

2. SIGNIFICANT ACCOUNTING POLICIES

The preparation of our consolidated financial statements, in conformity with U.S. generally accepted accounting principles, or GAAP, requires management to make estimates and assumptions that affect the reported amount of our assets and liabilities at the date of the consolidated financial statements and the reported amounts of income and expenses during the reported periods. In the opinion of management, all adjustments, which are of a normal recurring nature, considered necessary for the fair presentation of financial statements have been included. Changes in the economic and regulatory environment, financial markets, the credit worthiness of our portfolio companies, and any other parameters used in determining these estimates and assumptions could cause actual results to differ from these estimates and assumptions. We may reclassify certain prior period amounts to conform to the current period presentation. We have eliminated all intercompany balances and transactions. References to the Financial Accounting Standards Board’s, or FASB’s, Accounting Standards Codification, as amended, or ASC, serve as a single source of accounting literature. Subsequent events are evaluated and disclosed as appropriate for events occurring through the date the consolidated financial statements are issued.

Our consolidated financial statements are prepared in accordance with GAAP, consistent with ASC Topic 946, Financial Services – Investment Companies, and pursuant to the requirements for reporting on Form 10-K/Q and Articles 6, 10 and 12 of Regulation S-X, as appropriate. In accordance with Article 6-09 of Regulation S-X, we have provided a consolidated statement of changes in net assets in lieu of a consolidated statement of changes in stockholders’ equity.

Restatement of Previously Issued Financial Statements

As noted in the Annual Report on Form 10-K for the year ended September 30, 2023, during the preparation of the financial statements as of and for the year ended September 30, 2023, Management identified an error in the classification and presentation of cash pertaining to the Company’s affiliates – PSSL and PTSF in the September 30, 2022 financial statements. The Company recorded cash activity and due to affiliates pertaining to their investments as a reduction of the cash account instead of presenting the related cash and cash equivalents as an asset and a due to affiliates as a liability. This misclassification also existed at December 31, 2022, and the impact of the error correction is reflected on the consolidated statement of cash flows for the three months ended December 31, 2022 as an increase to cash and cash equivalents, beginning of period totaling $3.6 million, an increase to cash and cash equivalents, end of period totaling $2.1 million, and decrease in due to affiliates of $1.5 million.

There was no impact from the error correction to total net assets and net asset value per share as reported on the consolidated statement of assets and liabilities as of December 31, 2022. The corrections related to the prior year comparative cash flow statement amounts were reported in the quarter ended December 31, 2022.

Our significant accounting policies consistently applied are as follows:

(a) Investment Valuations

We expect that there may not be readily available market values for many of the investments, which are or will be in our portfolio, and we value such investments at fair value as determined in good faith by or under the direction of our board of directors using a documented valuation policy and a consistently applied valuation process, as described in this Report. With respect to investments for which there is no readily available market value, the factors that the board of directors may take into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, comparison to publicly traded securities and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate or revise our valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and the difference may be material. See Note 5.

Our portfolio generally consists of illiquid securities, including debt and equity investments. With respect to investments for which market quotations are not readily available, or for which market quotations are deemed not reflective of the fair value, our board of directors undertakes a multi-step valuation process each quarter, as described below:

(1)

Our quarterly valuation process begins with each portfolio company or investment being initially valued by the investment professionals of our Investment Adviser responsible for the portfolio investment;

(2)

Preliminary valuation conclusions are then documented and discussed with the management of the Investment Adviser;

(3)

Our board of directors also engages independent valuation firms to conduct independent appraisals of our investments for which market quotations are not readily available or are readily available but deemed not reflective of the fair value of the investment. The independent valuation firms review management's preliminary valuations in light of their own independent assessment and also in light of any market quotations obtained from an independent pricing service, broker, dealer or market maker;

(4)

The audit committee of our board of directors reviews the preliminary valuations of our Investment Adviser and those of the independent valuation firms on a quarterly basis, periodically assesses the valuation methodologies of the independent valuation firms, and responds to and supplements the valuation recommendations of the independent valuation firms to reflect any comments; and

(5)

Our board of directors discusses these valuations and determines the fair value of each investment in our portfolio in good faith, based on the input of our Investment Adviser, the respective independent valuation firms and the audit committee.

Our board of directors generally uses market quotations to assess the value of our investments for which market quotations are readily available. We obtain these market values from independent pricing services or at bid prices obtained from at least two brokers or dealers, if available, or otherwise from a principal market maker or a primary market dealer. The Investment Adviser assesses the source and reliability of bids from brokers or dealers. If the board of directors has a bona fide reason to believe any such market quote does not reflect the fair value of an investment, it may independently value such investments by using the valuation procedure that it uses with respect to assets for which market quotations are not readily available.

(b) Security Transactions, Revenue Recognition, and Realized/Unrealized Gains or Losses

Security transactions are recorded on a trade-date basis. We measure realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, using the specific identification method, without regard to unrealized appreciation or depreciation previously recognized, but

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

considering prepayment penalties. Net change in unrealized appreciation or depreciation reflects the change in the fair values of our portfolio investments, the Credit Facility and the 2023 Notes during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.

We record interest income on an accrual basis to the extent that we expect to collect such amounts. For loans and debt investments with contractual PIK interest, which represents interest accrued and added to the loan balance that generally becomes due at maturity, we will generally not accrue PIK interest when the portfolio company valuation indicates that such PIK interest is not collectable. We do not accrue as a receivable interest on loans and debt investments if we have reason to doubt our ability to collect such interest. Loan origination fees, original issue discount, or OID, market discount or premium and deferred financing costs on liabilities, which we do not fair value, are capitalized and then accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. We record prepayment penalties earned on loans and debt investments as income. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts. From time to time, the Company receives certain fees from portfolio companies, which may or may not be non-recurring in nature. Such fees include loan prepayment penalties, structuring fees, amendment fees and agency fees, and are recorded as other investment income when earned. Litigation settlements are accounted for in accordance with the gain contingency provisions of ASC Subtopic 450-30, Gain Contingencies, or ASC 450-30.

Loans are placed on non-accrual status when principal or interest payments are past due 30 days or more and/or if there is reasonable doubt that principal or interest will be collected. Accrued interest is generally reversed when a loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management’s judgment. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management’s judgment, are likely to remain current. As of December 31, 2023, we had one portfolio company on non-accrual, representing 0.1% and zero percent of our overall portfolio on a cost and fair value basis, respectively. As of September 30, 2023, we had three portfolio companies on non-accrual, representing 0.9% and 0.2% of our overall portfolio on a cost and fair value basis, respectively.

We have complied with the requirements of Subchapter M of the Code and have qualified to be treated as a RIC for federal income tax purposes. In this regard, we account for income taxes using the asset and liability method prescribed by ASC Topic 740, Income Taxes, or ASC 740. Under this method, income taxes are provided for amounts currently payable and for amounts deferred as tax assets and liabilities based on differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. Based upon our qualification and election to be treated as a RIC for U.S. federal income tax purposes, we typically do not incur material U.S. federal income taxes. However, we may choose to retain a portion of our calendar year income, which may result in the imposition of a federal excise tax, or we may incur taxes through our taxable subsidiaries, including the Taxable Subsidiary. For both the three months ended December 31, 2023 and 2022, we recorded a provision for taxes on net investment income of $0.2 million and $0.5 million, respectively, pertaining to federal excise tax.

We recognize the effect of a tax position in our Consolidated Financial Statements in accordance with ASC 740 when it is more likely than not, based on the technical merits, that the position will be sustained upon examination by the applicable tax authority. Tax positions not considered to satisfy the “more-likely-than-not” threshold would be recorded as a tax expense or benefit. Penalties or interest, if applicable, that may be assessed relating to income taxes would be classified as other operating expenses in the financial statements. There were no tax accruals relating to uncertain tax positions and no amounts accrued for any related interest or penalties with respect to the periods presented herein. The Company’s determinations regarding ASC 740 may be subject to review and adjustment at a later date based upon factors including, but not limited to, an ongoing analysis of tax laws, regulations and interpretations thereof. Although the Company files both federal and state income tax returns, the Company’s major tax jurisdiction is federal.

The Taxable Subsidiary (PFLT Investment Holdings, LLC, a second tier wholly-owned subsidiary of the Company), is subject to U.S. federal, state and local corporate income taxes. The income tax expense and related tax liabilities of the Taxable Subsidiary are reflected in the Company’s consolidated financial statements.

For the three months ended December 31, 2023, the Company recognized a provision for taxes of zero on unrealized appreciation (depreciation) on investments by the Taxable Subsidiary. For the three months ended December 31, 2022 the Company recognized a provision for taxes of $0.7 million on unrealized appreciation (depreciation) on investments by the Taxable Subsidiary. The provision for taxes on unrealized appreciation (depreciation) on investments is the result of netting (i) the expected tax liability on gains from sales of investments and (ii) the expected tax benefit from the use of losses in the current year. As of December 31, 2023 and September 30, 2023, $1.8 and $1.8 million, respectively, was accrued as a deferred tax liability on the Consolidated Statements of Assets and Liabilities relating to unrealized gain on investments held by the Taxable Subsidiary. As of December 31, 2023 and September 30, 2023, zero and $0.3 million, respectively, was accrued as a provision for taxes on the Consolidated Statements of Operations relating to realized gain on investments held by the Taxable Subsidiary. During the three months ended December 31, 2023 and 2022, the Company paid zero and zero, respectively, in taxes on realized gains on the sale of investments held by the Taxable Subsidiary.

We operate in a manner to maintain our election to be subject to tax as a RIC and to eliminate corporate-level U.S. federal income tax (other than the 4% excise tax) by distributing sufficient investment company taxable income and capital gain net income (if any). As a result, we will have an effective tax rate equal to 0% before the excise tax and income taxes incurred by the Taxable Subsidiary. As such, a reconciliation of the differences between our reported income tax expense and its tax expense at the federal statutory rate of 21% is not meaningful.

Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and net realized gains recognized for financial reporting purposes. Differences between tax regulations and GAAP may be permanent or temporary. Permanent differences are reclassified among capital accounts in the consolidated financial statements of assets and liabilities to reflect their tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.

(d) Distributions and Capital Transactions

Distributions to common stockholders are recorded on the ex-dividend date. The amount to be paid, if any, as a distribution is determined by the board of directors each quarter and is generally based upon the earnings estimated by management. Net realized capital gains, if any, may be distributed at least annually. The tax attributes for distributions will generally include ordinary income and capital gains but may also include certain tax-qualified dividends and/or a return of capital.

Capital transactions through offerings of our common stock are recorded when issued and offering costs are charged as a reduction of capital upon issuance of our common stock.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

with each of the Sales Agents (together, the "Amended and Restated Equity Distribution Agreements") to increase the aggregate offering price to up to $250 million. The Amended and Restated Equity Distribution Agreements, provide that we may offer and sell shares of our common stock from time to time through a sales agent in amounts and at times to be determined by us. Actual sales will depend on a variety of factors to be determined by us from time to time, including, market conditions and the trading price of our common stock. The Investment Adviser may, from time to time, in its sole discretion, pay some or all of the commissions payable under the equity distribution agreements or make additional supplemental payments to ensure that the sales price per share of our common stock in connection with all of the offerings made hereunder will not be less than our current NAV per share. Any such payments made by the Investment Adviser will not be subject to reimbursement by us.

During the three months ended December 31, 2023, we did not issue any shares of common stock through the ATM Program.

(e) Foreign Currency Translation

Our books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

Fair value of investment securities, other assets and liabilities – at the exchange rates prevailing at the end of the applicable period; and

Purchases and sales of investment securities, income and expenses – at the exchange rates prevailing on the respective dates of such transactions.

Although net assets and fair values are presented based on the applicable foreign exchange rates described above, we do not isolate that portion of the results of operations due to changes in foreign exchange rates on investments, other assets and debt from the fluctuations arising from changes in fair value of investments and liabilities held. Such fluctuations are included with the net realized and unrealized gain or loss from investments and liabilities.

Foreign security and currency translations may involve certain considerations and risks not typically associated with investing in U.S. companies and U.S. government securities. These risks include, but are not limited to, currency fluctuations and revaluations and future adverse political, social and economic developments, which could cause investments in foreign markets to be less liquid and prices to be more volatile than those of comparable U.S. companies or U.S. government securities.

(f) Consolidation

As permitted under Regulation S-X and as explained by ASC paragraph 946-810-45-3, PennantPark Floating Rate Capital Ltd. will generally not consolidate its investment in a company other than an investment company wholly-owned subsidiary or a controlled operating company whose business consists of providing services to us. Accordingly, we have consolidated the results of our taxable subsidiaries, including the Taxable Subsidiary, Funding I and the Securitization Issuer in our Consolidated Financial Statements. We do not consolidate our non-controlling interest in PSSL or PTSF. See further description of our investment in PSSL in Note 4.

(g) Asset Transfers and Servicing

Asset transfers that do not meet ASC Topic 860, Transfers and Servicing, requirements for sale accounting treatment are reflected in the Consolidated Statements of Assets and Liabilities and the Consolidated Schedules of Investments as investments. The creditors of Funding I have received a security interest in all of its assets and such assets are not intended to be available to the creditors of PennantPark Floating Rate Capital Ltd. or any of its affiliates.

(h) Recent Accounting Pronouncements

In March 2020, the FASB issued Accounting Standards Update, or ASU, No. 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting.” The guidance provides optional expedients and exceptions for applying GAAP to contract modifications, hedging relationships and other transactions, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued because of the reference rate reform. ASU 2020-04 is effective for all entities as of March 12, 2020 through December 31, 2022. The FASB approved an (optional) two year extension to December 31, 2024, for transitioning away from LIBOR. The Company utilized the optional expedients and exceptions provided by ASU 2020-04 during the three months ended December 31, 2023, the effect of which was not material to the consolidated financial statements and the notes thereto.

In March 2022, the FASB issued ASU No. 2022-02, “Financial Instruments - Credit Losses (Topic 326)”, which is intended to address issues identified during the post-implementation review of ASU 2016-13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments”. The amendment, among other things, eliminates the accounting guidance for troubled debt restructurings by creditors in Subtopic 310-40, “Receivables - Troubled Debt Restructurings by Creditors”, while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. The new guidance is effective for interim and annual periods beginning after December 15, 2022. The Company has adopted the new accounting standard implementing appropriate controls and procedures, the effect of which was not material to the consolidated financial statements and the notes thereto.

In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, or ASU 2022-03, which changed the fair value measurement disclosure requirements of ASC Topic 820, Fair Value Measurements and Disclosures, or ASC 820. The amendments clarify that a contractual restriction on the sale of an equity security is not considered part of the unit of account of the equity security and, therefore, is not considered in measuring fair value. The amendments also clarify that an entity cannot, as a separate unit of account, recognize and measure a contractual sale restriction. The new guidance is effective for fiscal years beginning after December 15, 2023, including interim periods therein. Early application is permitted. The Company is currently evaluating the impact the adoption of this new accounting standard will have on its consolidated financial statements, but the impact of the adoption is not expected to be material.

3. AGREEMENTS AND RELATED PARTY TRANSACTIONS

(a) Investment Management Agreement

The Investment Management Agreement with the Investment Adviser was reapproved by our board of directors, including a majority of our directors who are not interested persons of us or the Investment Adviser, in February 2024. Under the Investment Management Agreement, the Investment Adviser, subject to the overall supervision of our board of directors, manages the day-to-day operations of and provides investment advisory services to us. The Investment Adviser serves as the collateral manager to Funding I and has irrevocably directed that any management fee owed with respect to such services is to be paid to the Company so long as the Investment Adviser remains the collateral manager. This arrangement does not increase our consolidated management fee. For providing these services, the Investment Adviser receives a fee from us consisting of two components— a base management fee and an incentive fee.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

Base Management Fee

The base management fee is calculated at an annual rate of 1.00% of our “average adjusted gross assets,” which equals our gross assets (net of U.S. Treasury Bills, temporary draws under any credit facility, cash and cash equivalents, repurchase agreements or other balance sheet transactions undertaken at the end of a fiscal quarter for purposes of preserving investment flexibility for the next quarter and unfunded commitments, if any) and is payable quarterly in arrears. The base management fee is calculated based on the average adjusted gross assets at the end of the two most recently completed calendar quarters, and appropriately adjusted for any share issuances or repurchases during the current calendar quarter. For example, if we sold shares on the 45th day of a quarter and did not use the proceeds from the sale to repay outstanding indebtedness, our gross assets for such quarter would give effect to the net proceeds of the issuance for only 45 days of the quarter during which the additional shares were outstanding. For the three months ended December 31, 2023 and 2022, the Investment Adviser earned a base management fee of $3.0 million and $2.9 million respectively, from us.

Incentive Fee

The incentive fee has two parts, as follows:

One part is calculated and payable quarterly in arrears based on our Pre-Incentive Fee Net Investment Income for the immediately preceding calendar quarter. For this purpose, Pre-Incentive Fee Net Investment Income means interest income, dividend income and any other income, including any other fees (other than fees for providing managerial assistance), such as amendment, commitment, origination, prepayment penalties, structuring, diligence and consulting fees or other fees received from portfolio companies, accrued during the calendar quarter, minus our operating expenses for the quarter (including the base management fee, any expenses payable under the Administration Agreement and any interest expense or amendment fees under any credit facility and distribution paid on any issued and outstanding preferred stock, but excluding the incentive fee). Pre-Incentive Fee Net Investment Income includes, in the case of investments with a deferred interest feature (such as OID, debt instruments with PIK interest and zero-coupon securities), accrued income not yet received in cash. Pre-Incentive Fee Net Investment Income does not include any realized capital gains, computed net of all realized capital losses or unrealized capital appreciation or depreciation. Pre-Incentive Fee Net Investment Income, expressed as a percentage of the value of our net assets at the end of the immediately preceding calendar quarter, is compared to the hurdle rate of 1.75% per quarter (7.00% annualized). We pay the Investment Adviser an incentive fee with respect to our Pre-Incentive Fee Net Investment Income in each calendar quarter as follows: (1) no incentive fee in any calendar quarter in which our Pre-Incentive Fee Net Investment Income does not exceed the hurdle rate of 1.75%, (2) 50% of our Pre-Incentive Fee Net Investment Income with respect to that portion of such Pre-Incentive Fee Net Investment Income, if any, that exceeds the hurdle rate but is less than 2.9167% in any calendar quarter (11.67% annualized) (we refer to this portion of our Pre-Incentive Fee Net Investment Income (which exceeds the hurdle but is less than 2.9167%) as the “catch-up,” which is meant to provide our Investment Adviser with 20% of our Pre-Incentive Fee Net Investment Income, as if a hurdle did not apply, if this net investment income exceeds 2.9167% in any calendar quarter), and (3) 20% of the amount of our Pre-Incentive Fee Net Investment Income, if any, that exceeds 2.9167% in any calendar quarter. These calculations are pro-rated for any share issuances or repurchases during the relevant quarter, if applicable. For the three months ended December 31, 2023 and 2022, the Investment Adviser earned $4.9 million and $3.4 million, respectively, in incentive fees on net investment income from us.

The second part of the incentive fee is determined and payable in arrears as of the end of each calendar year (or upon termination of the Investment Management Agreement, as of the termination date) and equals 20% of our realized capital gains, if any, on a cumulative basis from inception through the end of each calendar year, computed net of all realized capital losses and unrealized capital depreciation on a cumulative basis, less the aggregate amount of any previously paid capital gain incentive fees. For the three months ended December 31, 2023 and 2022, the Investment Adviser did not accrue an incentive fee on capital gains, as calculated under the Investment Management Agreement (as described above).

Under GAAP, we are required to accrue a capital gains incentive fee based upon net realized capital gains and net unrealized capital appreciation and depreciation on investments held at the end of each period. In calculating the capital gains incentive fee accrual, we considered the cumulative aggregate unrealized capital appreciation in the calculation, as a capital gains incentive fee would be payable if such unrealized capital appreciation were realized, even though such unrealized capital appreciation is not permitted to be considered in calculating the fee actually payable under the Investment Management Agreement. This accrual is calculated using the aggregate cumulative realized capital gains and losses and cumulative unrealized capital appreciation or depreciation. If such amount is positive at the end of a period, then we record a capital gains incentive fee equal to 20% of such amount, less the aggregate amount of actual capital gains related to incentive fees paid in all prior years. If such amount is negative, then there is no accrual for such year. There can be no assurance that such unrealized capital appreciation will be realized in the future. The incentive fee accrued for, but not payable, under GAAP on our unrealized and realized capital gains for the three months ended December 31, 2023 and 2022, was zero, respectively.

(b) Administration Agreement

The Administration Agreement with the Administrator was reapproved by our board of directors, including a majority of the directors who are not interested persons of us, in February 2024. Under the Administration Agreement, the Administrator provides administrative services and office facilities to us. For providing these services, facilities and personnel, we have agreed to reimburse the Administrator for its allocable portion of overhead and other expenses incurred by the Administrator in performing its obligations under the Administration Agreement, including rent and our allocable portion of the costs of compensation and related expenses of our Chief Financial Officer, Chief Compliance Officer, Corporate Counsel and their respective staffs. The amount billed by the Administrator may include credits related to its administrative agreement with PSSL. The Administrator also offers, on our behalf, significant managerial assistance to portfolio companies to which we are required to offer such assistance. Reimbursement for certain of these costs is included in administrative services expenses in the Consolidated Statements of Operations. For the three months ended December 31, 2023 and 2022, we recorded administrative expenses of approximately $0.6 million and $0.1 million, respectively, including expenses the Administrator incurred for services described above.

On July 1, 2022, the Administration Agreement with the Administrator was amended to clarify that the Administrator may be reimbursed by the Company for certain (i) tax and general legal advice and/or services provided to the Company by in-house professionals of the Administrator related to ongoing operations of the Company; and (ii) transactional legal advice and/or services provided to the Company or portfolio companies by in-house professionals of the Administrator or its affiliates on matters related to potential or actual investments and transactions, including tax structuring and/or due diligence.

There were no transactions subject to Rule 17a-7 under the 1940 Act during each of the three months ended December 31, 2023 and 2022.

For the three months ended December 31, 2023 and 2022, we sold $62.7 million and $18.8 million in investments to PSSL at fair value, respectively, and recognized zero and zero of net realized gains (losses), respectively.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

For the three months ended December 31, 2023 and 2022, we sold no investments to PTSF.

As of December 31, 2023 and September 30, 2023, PFLT had a payable to PSSL and PTSF of $0.5 million and $0.6 million, respectively, presented as a Due to Affiliates on the consolidated statement of assets and liabilities. These amounts are related to cash owed to PSSL and PTSF from PFLT in connection with trades between the funds.

As of December 31, 2023 and September 30, 2023, PFLT had a receivable from the Administrator of $0.1 million and zero, respectively, presented as Due from Affiliate on the consolidated statements of assets and liabilities. This amount relates to agency fees collected on behalf of the Company.

4. INVESTMENTS

For the three months ended December 31, 2023 and 2022, purchases of investments, including PIK interest totaled $303.5 million and $65.6 million, respectively. For the three months ended December 31, 2023 and 2022, sales and repayments of investments totaled $103.8 million and $63.0 million, respectively.

Investments and cash and cash equivalents consisted of the following:


($ in thousands)	December 31, 2023				September 30, 2023
Investment Classification	Cost		Fair Value		Cost		Fair Value
First lien	$	887,271	$	880,376	$	708,452	$	696,078
First lien in PSSL		210,088		210,088		210,088		210,088
Second lien		1,113		150		1,113		149
Equity		101,968		128,184		83,188		109,978
Equity interests in PSSL		90,038		52,129		90,038		50,881
Total investments		1,290,478		1,270,927		1,092,878		1,067,174
Cash and cash equivalents		75,809		75,826		100,555		100,555
Total investments and cash and cash equivalents	$	1,366,287	$	1,346,753	$	1,193,433	$	1,167,729

The table below describes investments by industry classification and enumerates the percentage, by fair value, of the total portfolio assets (excluding cash and cash equivalents) in such industries:


Industry Classification	December 31, 2023 (1)				September 30, 2023 (1)
Aerospace and Defense		12		%		6
Healthcare Providers and Services		7				9
Media		7				9
Personal Products		7				8
Professional Services		6				7
Electronic Equipment, Instruments, and Components		6				3
Distributors		5				3
IT Services		5				4
Media: Diversified and Production		5				6
Auto Components		4				—
Healthcare Technology		4				4
High Tech Industries		4				5
Commercial Services & Supplies		3				4
Construction and Building		2				3
Insurance		2				3
Capital Equipment		2				2
Business Services		2				2
Chemicals, Plastics and Rubber		2				2
Consumer Services		1				2
Hotels, Restaurants and Leisure		1				2
Automobiles		1				2
Healthcare Equipment and Supplies		1				1
Diversified Consumer Services		1				3
Financial Services		1				1
Construction & Engineering		1				1
Leisure Products		1				1
Diversified Financial Services		1				1
Air Freight and Logistics		1				1
Textiles, Apparel and Luxury Goods		1				1
Energy Equipment and Services		1				1
Internet Software and Services		1				1
Food Products		1				1
Wholesale		1				1
All Other		—				—
Total		100	%			100	%

(1)

Excludes investments in PSSL.

PennantPark Senior Secured Loan Fund I LLC

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

In May 2017, we and Kemper formed PSSL, an unconsolidated joint venture. PSSL invests primarily in middle-market and other corporate debt securities consistent with our strategy. PSSL was formed as a Delaware limited liability company. As of December 31, 2023 and September 30, 2023, PSSL had total assets of $879.4 million and $869.4 million, respectively, and its investment portfolio consisted of investments in 106 and 105 portfolio companies, respectively. As of December 31, 2023, at fair value, the largest investment in a single portfolio company in PSSL was $21.1 million and the five largest investments totaled $91.7 million. As of September 30, 2023, at fair value, the largest investment in a single portfolio company in PSSL was $18.5 million and the five largest investments totaled $83.4 million. PSSL invests in portfolio companies in the same industries in which we may directly invest.

We and Kemper provide capital to PSSL in the form of first lien secured debt and equity interests. As of December 31, 2023, and September 30, 2023, we and Kemper owned 87.5% and 12.5%, respectively, of each of the outstanding first lien secured debt and equity interests. As of the same dates, our investment in PSSL consisted of first lien secured debt of $210.1 million (additional $27.6 million unfunded) and $210.1 million (additional $27.6 million unfunded), respectively, and equity interests of $90.0 million (additional $11.8 million unfunded) and $90.0 million (additional $11.8 million unfunded), respectively.

We and Kemper each appointed two members to PSSL’s four-person board of directors and investment committee. All material decisions with respect to PSSL, including those involving its investment portfolio, require unanimous approval of a quorum of the board of directors or investment committee. Quorum is defined as (i) the presence of two members of the board of directors or investment committee, provided that at least one individual is present that was elected, designated or appointed by each member; (ii) the presence of three members of the board of directors or investment committee, provided that the individual that was elected, designated or appointed by the member with only one individual present shall be entitled to cast two votes on each matter; and (iii) the presence of four members of the board of directors or investment committee shall constitute a quorum, provided that two individuals are present that were elected, designated or appointed by each member.

In August 2023 PSSL entered into a $260.0 million (decreased from $325.0 million) senior secured revolving credit facility which bears interest at SOFR plus 260 basis points (including a spread adjustment) with Ally Bank through its wholly-owned subsidiary, PennantPark Senior Secured Loan Facility LLC II, or PSSL Subsidiary II, subject to leverage and borrowing base restrictions.

In January 2021, PSSL completed a $300.7 million debt securitization in the form of a collateralized loan obligation, or the “2032 Asset-Backed Debt”. The 2032 Asset-Backed Debt is secured by a diversified portfolio of PennantPark CLO II, Ltd., a wholly-owned and consolidated subsidiary of PSSL, consisting primarily of middle market loans and participation interests in middle market loans. The 2032 Asset-Backed Debt is scheduled to mature in January 2032. On the closing date of the transaction, in consideration of PSSL’s transfer to PennantPark CLO II, Ltd. of the initial closing date loan portfolio, which included loans distributed to PSSL by certain of its wholly owned subsidiaries and us, PennantPark CLO II, Ltd. transferred to PSSL 100% of the Preferred Shares of PennantPark CLO II, Ltd. and 100% of the Class E Notes issued by PennantPark CLO II, Ltd.

In April 2023, PSSL completed a $297.8 million debt securitization in the form of a collateralized loan obligation, or the “2035 Asset-Backed Debt”. The 2035 Asset-Backed Debt is secured by a diversified portfolio of PennantPark CLO VI, LLC, a wholly-owned and consolidated subsidiary of PSSL, consisting primarily of middle market loans and participation interests in middle market loans. The 2035 Asset-Backed Debt is scheduled to mature in April 2035. On the closing date of the transaction, in consideration of PSSL’s transfer to PennantPark CLO VI, LLC of the initial closing date loan portfolio, which included loans distributed to PSSL by certain of its wholly owned subsidiaries and us, PennantPark CLO VI, LLC transferred to PSSL 100% of the Preferred Shares of CLO VI, LLC

Below is a summary of PSSL’s portfolio at fair value:


($ in thousands)	December 31, 2023			September 30, 2023
Total investments	$	836,857		$	785,859
Weighted average cost yield on income producing investments		12.1	%		12.1	%
Number of portfolio companies in PSSL		106			105
Largest portfolio company investment	$	21,114		$	18,463
Total of five largest portfolio company investments	$	91,715		$	83,365

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

Below is a listing of PSSL’s individual investments as of December 31, 2023 (Par and $ in thousands):


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)	Par		Cost		Fair Value (2)
First Lien Secured Debt - 1,398.7%
A1 Garage Merger Sub, LLC	12/22/2028	Commercial Services & Supplies		11.96	%	SOFR+660		2,932	$	2,881	$	2,918
ACP Avenu Buyer, LLC	10/1/2029	Business Services		11.75	%	SOFR+626		10,000		9,827		9,750
ACP Falcon Buyer, Inc.	8/1/2029	Business Services		11.85	%	SOFR+650		18,904		18,539		18,696
Ad.net Acquisition, LLC	5/7/2026	Media		11.61	%	SOFR+626		8,775		8,708		8,731
Alpine Acquisition Corp II	11/30/2026	Containers and Packaging		11.44	%	SOFR+600		12,820		12,519		12,307
Anteriad, LLC (f/k/a MeritDirect, LLC)	5/23/2024	Media: Advertising, Printing & Publishing		11.00	%	SOFR+565		4,930		4,912		4,881
Anteriad, LLC (f/k/a MeritDirect, LLC) - Incremental Term Loan	5/23/2024	Media: Advertising, Printing & Publishing		12.00	%	SOFR+665		4,813		4,778		4,788
Any Hour Services	7/21/2027	Professional Services		11.23	%	SOFR+585		7,491		7,338		7,416
Applied Technical Services, LLC	12/29/2026	Commercial Services & Supplies		11.25	%	SOFR+615		9,748		9,652		9,553
Arcfield Acquisition Corp.	8/3/2029	Aerospace and Defense		11.64	%	SOFR+625		11,200		11,048		11,088
Beta Plus Technologies, Inc.	7/1/2029	Business Services		11.10	%	SOFR+575		4,938		4,854		4,740
BioDerm, Inc.	1/31/2028	Healthcare and Pharmaceuticals		11.84	%	SOFR+650		8,955		8,854		8,865
Blackhawk Industrial Distribution, Inc.	9/17/2026	Distributors		11.75	%	SOFR+625		15,092		14,892		14,904
BlueHalo Financing Holdings, LLC	10/31/2025	Aerospace and Defense		12.01	%	SOFR+665		5,588		5,552		5,476
Broder Bros., Co.	12/4/2025	Consumer Products		11.65	%	SOFR+626		2,334		2,334		2,334
Burgess Point Purchaser Corporation	9/26/2029	Automotive		10.71	%	SOFR+525		446		418		419
By Light Professional IT Services, LLC	5/16/2025	High Tech Industries		12.40	%	SOFR+688		13,538		13,500		13,267
Cartessa Aesthetics, LLC	6/14/2028	Distributors		11.10	%	SOFR+575		9,612		9,490		9,612
CF512, Inc.	8/20/2026	Media		11.57	%	SOFR+619		6,803		6,713		6,667
CHA Holdings, Inc.	4/10/2025	Construction and Engineering		9.97	%	SOFR+461		5,484		5,448		5,484
Challenger Performance Optimization, Inc.	8/31/2024	Business Services		12.18	%	SOFR+775		9,232		9,208		8,909
			(PIK 1.00%)
Confluent Health, LLC	10/28/2028	Healthcare and Pharmaceuticals		9.47	%	SOFR+400		6,761		6,529		6,626
Connatix Buyer, Inc.	7/13/2027	Media		11.14	%	SOFR+576		3,805		3,756		3,634
Crane 1 Services, Inc.	8/16/2027	Commercial Services & Supplies		10.36	%	SOFR+501		2,084		2,063		2,073
Dr. Squatch, LLC	8/31/2027	Personal Products		11.20	%	SOFR+585		14,675		14,484		14,675
DRI Holding Inc.	12/21/2028	Media		10.71	%	SOFR+525		2,620		2,419		2,385
DRS Holdings III, Inc.	11/3/2025	Consumer Goods: Durable		11.75	%	SOFR+640		14,189		14,144		14,033
Duraco Specialty Tapes LLC	6/30/2024	Containers and Packaging		11.96	%	SOFR+650		10,876		10,833		10,702
ECL Entertainment, LLC	8/31/2030	Hotel, Gaming and Leisure		10.14	%	SOFR+475		5,000		4,913		5,004
EDS Buyer, LLC	1/10/2029	Electronic Equipment, Instruments, and Components		11.60	%	SOFR+625		8,933		8,817		8,843
Exigo Intermediate II, LLC	3/15/2027	Software		11.46	%	SOFR+610		12,643		12,484		12,453
ETE Intermediate II, LLC	5/29/2029	Diversified Consumer Services		11.89	%	SOFR+650		12,373		12,132		12,373
Fairbanks Morse Defense	6/17/2028	Aerospace and Defense		10.36	%	SOFR+475		10,169		10,119		10,150
Global Holdings InterCo LLC	3/16/2026	Diversified Financial Services		11.46	%	SOFR+610		3,726		3,715		3,540
Graffiti Buyer, Inc.	8/10/2027	Trading Companies & Distributors		10.95	%	SOFR+560		2,339		2,314		2,316
Hancock Roofing and Construction L.L.C.	12/31/2026	Insurance		10.95	%	SOFR+560		2,250		2,219		2,160
Holdco Sands Intermediate, LLC	11/23/2028	Aerospace and Defense		11.57	%	SOFR+635		4,900		4,830		4,851
HW Holdco, LLC	12/10/2024	Media		11.80	%	SOFR+640		3,014		2,993		2,968
Imagine Acquisitionco, LLC	11/15/2027	Software		10.74	%	SOFR+550		9,225		9,064		9,086
Inception Fertility Ventures, LLC	12/31/2024	Healthcare Providers and Services		12.64	%	SOFR+725		16,411		16,254		16,411
Infinity Home Services Holdco, Inc.	12/28/2028	Commercial Services & Supplies		12.20	%	SOFR+685		6,075		5,967		6,075
Integrative Nutrition, LLC	1/31/2025	Diversified Consumer Services		12.50	%	SOFR+715		11,130		11,113		10,351
			(PIK 2.25%)
Integrity Marketing Acquisition, LLC	8/27/2026	Insurance		11.54	%	SOFR+615		5,895		5,847		5,836
Inventus Power, Inc.	6/30/2025	Consumer Goods: Durable		12.97	%	SOFR+761		8,226		8,094		8,061
ITI Holdings, Inc.	3/3/2028	IT Services		10.96	%	SOFR+560		3,940		3,888		3,822
K2 Pure Solutions NoCal, L.P.	1/31/2024	Chemicals, Plastics and Rubber		15.46	%	SOFR+1000		14,602		14,599		14,602
Kinetic Purchaser, LLC	11/10/2027	Personal Products		11.50	%	SOFR+615		16,620		16,324		16,537
Lash OpCo, LLC	2/18/2027	Personal Products		12.48	%	SOFR+700		14,174		13,968		14,103
LAV Gear Holdings, Inc.	10/31/2025	Capital Equipment		11.82	%	SOFR+640		15,006		14,973		14,676
Lightspeed Buyer Inc.	2/3/2026	Healthcare Providers and Services		10.71	%	SOFR+535		12,024		11,896		11,964
LJ Avalon Holdings, LLC	1/31/2030	Environmental Industries		11.86	%	SOFR+640		2,579		2,533		2,527
Loving Tan Intermediate II, Inc.	5/31/2028	Consumer Products		12.35	%	SOFR+700		7,463		7,326		7,388
Lucky Bucks, LLC - First-Out Term Loan	10/2/2028	Hotel, Gaming and Leisure		13.03	%	SOFR+765		261		261		261
Lucky Bucks, LLC - Last-Out Term Loan	10/2/2029	Hotel, Gaming and Leisure		13.03	%	SOFR+765		522		522		522
MAG DS Corp	4/1/2027	Aerospace and Defense		10.95	%	SOFR+550		2,091		2,007		1,997
Magenta Buyer, LLC	7/31/2028	Software		10.64	%	SOFR+500		2,998		2,844		2,106
Marketplace Events, LLC - Super Priority First Lien Term Loan	9/30/2025	Media: Diversified and Production		10.94	%	SOFR+525		647		647		647
Marketplace Events, LLC - Super Priority First Lien Unfunded Term Loan (3)	9/30/2025	Media: Diversified and Production						589		-		-
Marketplace Events, LLC	9/30/2026	Media: Diversified and Production		10.94	%	SOFR+525		4,837		3,852		4,837
Mars Acquisition Holdings Corp.	5/14/2026	Media		11.01	%	SOFR+565		11,558		11,460		11,558
MBS Holdings, Inc.	4/16/2027	Internet Software and Services		11.21	%	SOFR+585		8,395		8,290		8,282
MDI Buyer, Inc.	7/25/2028	Chemicals, Plastics and Rubber		11.63	%	SOFR+625		6,364		6,260		6,212
Meadowlark Acquirer, LLC	12/10/2027	Professional Services		11.00	%	SOFR+565		2,366		2,332		2,295

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)


Issuer Name	Maturity		Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Medina Health, LLC	10/20/2028		Healthcare and Pharmaceuticals		11.60	%	SOFR+625			19,344	$	19,018	$	18,957
Mission Critical Electronics, Inc.	3/28/2024		Capital Equipment		11.29	%	SOFR+590			5,769		5,764		5,769
Municipal Emergency Services, Inc.	9/28/2027		Distributors		10.50	%	SOFR+515			3,421		3,374		3,418
NBH Group LLC	8/19/2026		Healthcare, Education & Childcare		11.19	%	SOFR+525			10,684		10,553		10,043
Neptune Flood Incorporated	5/9/2029		Insurance		11.72	%	SOFR+650			4,932		4,865		4,932
New Milani Group LLC	6/6/2024		Consumer Goods: Non-Durable		10.96	%	SOFR+550			14,175		14,161		14,175
NORA Acquisition, LLC	8/31/2029		Healthcare Providers and Services		11.70	%	SOFR+635			21,435		21,043		21,114
One Stop Mailing, LLC	5/7/2027		Air Freight and Logistics		11.72	%	SOFR+636			15,807		15,559		15,807
ORL Acquisitions, Inc.	9/3/2027		Consumer Finance		12.75	%	SOFR+740			2,217		2,198		1,884
Output Services Group, Inc - First-Out Term Loan	11/30/2028		Business Services		13.82	%	SOFR+843			821		821		821
Output Services Group, Inc - Last-Out Term Loan	5/30/2028		Business Services		12.07	%	SOFR+668			1,667		1,667		1,667
Owl Acquisition, LLC	2/4/2028		Professional Services		10.70	%	SOFR+550			3,893		3,835		3,834
Ox Two, LLC	5/18/2026		Construction and Building		12.86	%	SOFR+751			4,345		4,310		4,291
Pacific Purchaser, LLC	9/30/2028		Business Services		11.43	%	SOFR+625			12,028		11,808		11,848
Pequod Merger Sub, Inc. - Term Loan (f/k/a Simplicity Group)	12/2/2026		Diversified Financial Services		11.75	%	SOFR+640			11,474		11,281		11,244
PH Beauty Holdings III, Inc.	9/29/2025		Wholesale		10.65	%	SOFR+500			9,468		9,292		8,884
PL Acquisitionco, LLC	11/9/2027		Textiles, Apparel and Luxury Goods		12.46	%	SOFR+710			7,633		7,539		6,755
				(PIK 4.00%)
PlayPower, Inc.	5/8/2026		Consumer Goods: Durable		11.06	%	SOFR+565			2,551		2,497		2,474
Pragmatic Institute, LLC	7/6/2028		Education		11.14	%	SOFR+575			11,109		10,977		10,387
Quantic Electronics, LLC	11/19/2026		Aerospace and Defense		11.70	%	SOFR+635			2,796		2,774		2,740
Rancho Health MSO, Inc.	12/18/2025		Healthcare Providers and Services		11.24	%	SOFR+585			1,026		1,026		1,026
Reception Purchaser, LLC	2/28/2028		Air Freight and Logistics		11.50	%	SOFR+615			4,925		4,868		4,777
Recteq, LLC	1/29/2026		Leisure Products		12.50	%	SOFR+715			4,863		4,819		4,692
Research Now Group, LLC and Dynata, LLC	12/20/2024		Diversified Consumer Services		11.14	%	SOFR+576			12,399		12,314		10,973
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.)	6/15/2029		High Tech Industries		11.43	%	SOFR+625			3,739		3,669		3,683
Sales Benchmark Index LLC	1/3/2025		Professional Services		11.55	%	SOFR+620			9,268		9,233		9,222
Sargent & Greenleaf Inc.	12/20/2024		Wholesale		12.96	%	SOFR+760			5,181		5,165		5,155
				(PIK 1.00%)
Schlesinger Global, Inc.	7/14/2025		Business Services		12.53	%	SOFR+715			11,791		11,780		11,407
				(PIK 0.50%)
Seaway Buyer, LLC	6/13/2029		Chemicals, Plastics and Rubber		11.50	%	SOFR+615			4,938		4,874		4,765
Sigma Defense Systems, LLC	12/18/2027		Aerospace and Defense		12.50	%	SOFR+715			12,141		11,973		12,020
Skopima Consilio Parent, LLC	5/17/2028		Business Services		9.97	%	SOFR+450			1,300		1,275		1,290
Smile Brands Inc.	10/14/2025		Healthcare and Pharmaceuticals		9.98	%	SOFR+450			11,766		11,733		10,299
Solutionreach, Inc.	7/17/2025		Healthcare and Pharmaceuticals		12.53	%	SOFR+700			4,582		4,554		4,568
Spendmend Holdings LLC	3/1/2028		Healthcare Technology		11.00	%	SOFR+565			4,102		4,040		4,057
STV Group Incorporated	12/11/2026		Construction and Building		10.71	%	SOFR+535			9,075		9,028		8,985
Summit Behavioral Healthcare, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.40	%	SOFR+501			1,782		1,695		1,777
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)	8/16/2027		Aerospace and Defense		11.33	%	SOFR+615			14,700		14,518		14,612
Team Services Group, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.75	%	SOFR+500			346		333		342
Teneo Holdings LLC	7/18/2025		Business Services		10.71	%	SOFR+535			2,256		2,255		2,251
The Bluebird Group LLC	7/27/2026		Professional Services		12.00	%	SOFR+665			8,569		8,455		8,475
The Vertex Companies, LLC	8/31/2027		Construction and Engineering		11.46	%	SOFR+610			7,696		7,577		7,684
TPC Canada Parent, Inc. and TPC US Parent, LLC	11/24/2025		Consumer Goods: Non-Durable		11.04	%	SOFR+565			8,640		8,553		8,554
TWS Acquisition Corporation	6/16/2025		Diversified Consumer Services		11.78	%	SOFR+640			3,740		3,738		3,740
Tyto Athene, LLC	4/1/2028		IT Services		11.04	%	SOFR+565			14,670		14,569		13,555
Urology Management Holdings, Inc.	6/15/2026		Healthcare and Pharmaceuticals		11.93	%	SOFR+665			6,875		6,766		6,732
Walker Edison Furniture Company LLC	3/1/2029		Wholesale		12.21	%	SOFR+685			4,028		4,028		3,947
Walker Edison Furniture Company LLC - Junior Revolving Credit Facility	3/1/2029		Wholesale		11.71	%	SOFR+635			1,667		1,667		1,667
Walker Edison Furniture Company LLC - DDTL - Unfunded (3)	3/1/2029		Wholesale							1,042		-		(21	)
Wildcat Buyerco, Inc.	2/27/2027		Electronic Equipment, Instruments, and Components		11.11	%	SOFR+575			16,138		15,993		15,896
Zips Car Wash, LLC	3/1/2024		Automobiles		12.70	%	SOFR+735			16,732		16,698		16,355

Total First Lien Secured Debt												841,081		833,276
Equity Securities - 3.9%
Lucky Bucks, LLC		—	Hotel, Gaming and Leisure		—			—		74		2,062		2,062
New MPE Holdings, LLC		—	Media: Diversified and Production		—			—		-		-		507
Output Services Group, Inc		—	Business Services		—			—		126		1,012		1,012
Walker Edison Furniture - Common Equity		—	Wholesale		—			—		36		3,393		-
Total Equity Securities												6,467		3,581
Total Investments - 1,404.7%												847,548		836,857
Cash and Cash Equivalents - 61.0%
BlackRock Federal FD Institutional 30												36,339		36,339
Total Cash and Cash Equivalents												36,339		36,339
Total Investments and Cash Equivalents —1,465.7%											$	883,887	$	873,196
Liabilities in Excess of Other Assets — (1,365.7)%														(813,620	)
Members' Equity—100.0%													$	59,576

cash a

(1)

Represents floating rate instruments that accrue interest at a predetermined spread relative to an index, typically the applicable Secured Overnight Financing Rate or "SOFR", or Prime rate or “P”. The spread may change based on the type of rate used. The terms in the Consolidated Schedule of Investments disclose the actual interest rate in effect as of the reporting period. LIBOR loans are typically indexed to a 30-day, 60-day, 90-day or 180-day SOFR rate (1M S, 2M S, 3M S, or 6M S, respectively), at the borrower’s option. All securities are subject to a SOFR or Prime rate floor where a spread is provided, unless noted. The spread provided includes PIK interest and other fee rates, if any.

(2)

Valued based on PSSL’s accounting policy.

(3)

Represents the purchase of a security with a delayed settlement or a revolving line of credit that is currently an unfunded investment. This security does not earn a basis point spread above an index while it is unfunded.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

Below is a listing of PSSL’s individual investments as of September 30, 2023 (Par and $ in thousands)


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)	Par		Cost		Fair Value (2)
First Lien Secured Debt - 1,347.5%
A1 Garage Merger Sub, LLC	12/22/2028	Commercial Services & Supplies		11.84	%	SOFR+660		2,940	$	2,886	$	2,925
Ad.net Acquisition, LLC	5/7/2026	Media		11.65	%	SOFR+626		8,798		8,723		8,754
Alpine Acquisition Corp II	11/30/2026	Containers and Packaging		11.24	%	SOFR+600		12,852		12,535		12,338
Anteriad, LLC (f/k/a MeritDirect, LLC)	5/23/2024	Media: Advertising, Printing & Publishing		11.04	%	SOFR+550		5,001		4,971		4,913
Anteriad Holdings Inc (fka MeritDirect) March 2023	5/23/2024	Media: Advertising, Printing & Publishing		12.04	%	SOFR+650		4,875		4,817		4,814
Any Hour Services	7/21/2027	Professional Services		11.59	%	SOFR+585		7,510		7,348		7,360
Apex Service Partners, LLC	7/31/2025	Diversified Consumer Services		10.52	%	SOFR+525		1,002		1,002		1,000
Apex Service Partners, LLC Term Loan B	7/31/2025	Diversified Consumer Services		11.04	%	SOFR+550		2,187		2,187		2,181
Apex Service Partners, LLC Term Loan C	7/31/2025	Diversified Consumer Services		10.69	%	SOFR+525		11,013		10,972		10,985
Applied Technical Services, LLC	12/29/2026	Commercial Services & Supplies		11.54	%	SOFR+615		9,579		9,475		9,387
Applied Technical Services, LLC - DDTL Unfunded (3)	12/29/2026	Commercial Services & Supplies						194		-		(2	)
Arcfield Acquisition Corp.	8/3/2029	Aerospace and Defense		11.62	%	SOFR+625		9,218		9,093		9,126
Beta Plus Technologies, Inc.	7/1/2029	Business Services		11.14	%	SOFR+575		4,950		4,863		4,604
BioDerm, Inc.	1/31/2028	Healthcare and Pharmaceuticals		11.83	%	SOFR+650		8,978		8,874		8,933
Blackhawk Industrial Distribution, Inc.	9/17/2026	Distributors		11.79	%	SOFR+640		15,132		14,928		14,905
Broder Bros., Co.	12/4/2025	Consumer Products		11.50	%	SOFR+626		2,349		2,349		2,349
By Light Professional IT Services, LLC	5/16/2025	High Tech Industries		12.43	%	SOFR+688		13,821		13,778		13,579
Cadence Aerospace, LLC	11/14/2023	Aerospace and Defense		12.07	%	SOFR+665		4,011		4,010		4,011
			(PIK 2.00%)
Cartessa Aesthetics, LLC	6/14/2028	Distributors		11.39	%	SOFR+600		9,636		9,509		9,636
CHA Holdings, Inc.	4/10/2025	Construction and Engineering		10.15	%	SOFR+476		5,499		5,455		5,499
Challenger Performance Optimization, Inc.	8/31/2024	Business Services		12.18	%	SOFR+675		9,232		9,201		8,955
			(PIK 1.00%)
Confluent Health, LLC	10/28/2028	Healthcare and Pharmaceuticals		9.32	%	SOFR+400		6,797		6,559		6,445
Connatix Buyer, Inc.	7/13/2027	Media		11.16	%	SOFR+576		3,815		3,762		3,681
Crane 1 Services, Inc.	8/16/2027	Commercial Services & Supplies		10.90	%	SOFR+551		2,089		2,067		2,079
Dr. Squatch, LLC	8/31/2027	Personal Products		11.24	%	SOFR+585		14,712		14,511		14,712
DRI Holding Inc.	12/21/2028	Media		10.67	%	SOFR+525		2,627		2,418		2,394
DRS Holdings III, Inc.	11/3/2025	Consumer Goods: Durable		11.79	%	SOFR+640		14,429		14,376		14,256
Duraco Specialty Tapes LLC	6/30/2024	Containers and Packaging		11.89	%	SOFR+650		10,904		10,838		10,740
ECL Entertainment, LLC	8/31/2030	Hotel, Gaming and Leisure		10.07	%	SOFR+475		5,000		4,900		4,985
EDS Buyer, LLC	1/10/2029	Electronic Equipment, Instruments, and Components		11.64	%	SOFR+625		8,955		8,833		8,821
Electro Rent Corporation	1/17/2024	Electronic Equipment, Instruments, and Components		11.00	%	SOFR+550		2,219		2,200		2,171
Exigo Intermediate II, LLC	3/15/2027	Software		11.17	%	SOFR+585		12,675		12,505		12,422
ETE Intermediate II, LLC	5/29/2029	Diversified Consumer Services		11.89	%	SOFR+650		12,404		12,154		12,193
Fairbanks Morse Defense	6/17/2028	Aerospace and Defense		10.40	%	SOFR+475		10,195		10,143		10,114
Global Holdings InterCo LLC	3/16/2026	Diversified Financial Services		11.96	%	SOFR+660		3,736		3,724		3,549
Graffiti Buyer, Inc.	8/10/2027	Trading Companies & Distributors		10.99	%	SOFR+575		2,345		2,316		2,322
Hancock Roofing and Construction L.L.C.	12/31/2026	Insurance		10.92	%	SOFR+560		2,250		2,217		2,194
Holdco Sands Intermediate, LLC	11/23/2028	Aerospace and Defense		11.32	%	SOFR+585		4,913		4,838		4,913
HW Holdco, LLC	12/10/2024	Media		11.75	%	SOFR+640		3,014		2,988		2,968
Imagine Acquisitionco, LLC	11/15/2027	Software		10.72	%	SOFR+535		9,248		9,075		9,110
Inception Fertility Ventures, LLC	12/31/2024	Healthcare Providers and Services		12.51	%	SOFR+715		16,453		16,257		16,453
Infinity Home Services Holdco, Inc.	12/28/2028	Commercial Services & Supplies		12.24	%	SOFR+685		6,090		5,979		6,090
Integrated Data Services	8/1/2029	Business Services		11.87	%	SOFR+650		18,904		18,532		18,463
Integrative Nutrition, LLC	1/31/2025	Diversified Consumer Services		12.54	%	SOFR+700		11,105		11,083		10,439
			(PIK 2.25%)
Integrity Marketing Acquisition, LLC	8/27/2026	Insurance		11.57	%	SOFR+575		5,906		5,851		5,847
ITI Holdings, Inc.	3/3/2028	IT Services		11.06	%	SOFR+560		3,940		3,886		3,861
K2 Pure Solutions NoCal, L.P.	12/20/2023	Chemicals, Plastics and Rubber		13.42	%	SOFR+810		15,509		15,487		15,509
Kinetic Purchaser, LLC	11/10/2027	Personal Products		11.54	%	SOFR+615		16,662		16,346		16,412
Lash OpCo, LLC	2/18/2027	Personal Products		12.13	%	SOFR+675		14,210		13,989		14,068
LAV Gear Holdings, Inc.	10/31/2024	Capital Equipment		11.74	%	SOFR+643		15,042		14,997		14,862
Lightspeed Buyer Inc.	2/3/2026	Healthcare Providers and Services		10.70	%	SOFR+535		12,056		11,911		11,935
LJ Avalon Holdings, LLC	1/31/2030	Environmental Industries		11.77	%	SOFR+640		2,585		2,537		2,534
Loving Tan Intermediate II, Inc.	5/26/2028	Consumer Products		12.39	%	SOFR+700		7,481		7,337		7,369
Lucky Bucks, LLC (4)	7/20/2027	Hotel, Gaming and Leisure		0.00	%			4,489		4,207		1,182
Lucky Bucks. LLC - OpCo DIP Loans	9/30/2025	Hotel, Gaming and Leisure		15.33	%	SOFR+1000		160		158		160
MAG DS Corp	4/1/2027	Aerospace and Defense		10.99	%	SOFR+550		2,097		2,007		1,986
Magenta Buyer, LLC	7/31/2028	Software		10.63	%	SOFR+500		3,006		2,845		2,228
Marketplace Events, LLC - Super Priority First Lien Term Loan	9/30/2025	Media: Diversified and Production		10.94	%	SOFR+525		647		647		647
Marketplace Events, LLC - Super Priority First Lien Unfunded Term Loan (3)	9/30/2025	Media: Diversified and Production						589		-		-
Marketplace Events, LLC	9/30/2026	Media: Diversified and Production		10.94	%	SOFR+525		4,837		3,782		4,837
Mars Acquisition Holdings Corp.	5/14/2026	Media		11.04	%	SOFR+565		11,588		11,476		11,472
MBS Holdings, Inc.	4/16/2027	Internet Software and Services		11.17	%	SOFR+585		7,859		7,758		7,749
MDI Buyer, Inc.	7/25/2028	Chemicals, Plastics and Rubber		11.32	%	SOFR+600		6,380		6,271		6,244
Meadowlark Acquirer, LLC	12/10/2027	Professional Services		11.04	%	SOFR+565		2,372		2,336		2,312

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)


Issuer Name	Maturity		Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Mission Critical Electronics, Inc.	3/28/2024		Capital Equipment		11.29	%	SOFR+515			5,769	$	5,763	$	5,740
Municipal Emergency Services, Inc.	9/28/2027		Distributors		11.04	%	SOFR+565			3,430		3,380		3,355
NBH Group LLC	8/19/2026		Healthcare, Education & Childcare		10.93	%	SOFR+525			10,711		10,572		10,497
New Milani Group LLC	6/6/2024		Consumer Goods: Non-Durable		10.92	%	SOFR+550			14,213		14,194		14,213
One Stop Mailing, LLC	5/7/2027		Air Freight and Logistics		11.68	%	SOFR+636			15,849		15,588		15,849
ORL Acquisitions, Inc.	9/3/2027		Consumer Finance		12.84	%	SOFR+725			2,223		2,202		2,023
Output Services Group, Inc. (4)	6/27/2026		Business Services		0.00	%		—		7,759		7,689		1,513
Owl Acquisition, LLC	2/4/2028		Professional Services		10.80	%	SOFR+575			3,893		3,832		3,834
Ox Two, LLC	5/18/2026		Construction and Building		12.90	%	SOFR+751			4,345		4,306		4,269
Peaquod Merger Sub, Inc.	12/2/2026		Diversified Financial Services		11.79	%	SOFR+640			11,474		11,267		11,244
PH Beauty Holdings III, Inc.	9/29/2025		Wholesale		10.68	%	SOFR+500			9,493		9,282		7,974
PL Acquisitionco, LLC	11/9/2027		Textiles, Apparel and Luxury Goods		12.42	%	SOFR+710			7,565		7,467		6,809
				(PIK 4.00%)
PlayPower, Inc.	5/8/2026		Consumer Goods: Durable		10.57	%	SOFR+565			2,551		2,491		2,436
Pragmatic Institute, LLC	7/6/2028		Education		11.17	%	SOFR+575			11,138		10,999		10,636
Quantic Electronics, LLC	11/19/2026		Aerospace and Defense		11.74	%	SOFR+635			2,803		2,776		2,761
Rancho Health MSO, Inc.	12/18/2025		Healthcare Providers and Services		11.22	%	SOFR+585			1,029		1,029		1,029
Reception Purchaser, LLC	2/28/2028		Air Freight and Logistics		11.54	%	SOFR+600			4,938		4,876		4,740
Recteq, LLC	1/29/2026		Leisure Products		12.54	%	SOFR+700			4,875		4,825		4,729
Research Now Group, LLC and Dynata, LLC	12/20/2024		Diversified Consumer Services		11.13	%	SOFR+576			12,432		12,322		10,878
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.)	6/15/2029		High Tech Industries		11.52	%	SOFR+625			3,749		3,676		3,692
Sales Benchmark Index LLC	1/3/2025		Professional Services		11.59	%	SOFR+620			9,522		9,474		9,475
Sargent & Greenleaf Inc.	12/20/2024		Wholesale		12.92	%	SOFR+760			5,167		5,148		5,116
				(PIK 1.00%)
Schlesinger Global, Inc.	7/14/2025		Business Services		12.52	%	SOFR+715			11,791		11,777		11,407
				(PIK 0.50%)
Seaway Buyer, LLC	6/13/2029		Chemicals, Plastics and Rubber		11.54	%	SOFR+615			4,950		4,884		4,802
Sigma Defense Systems, LLC	12/18/2025		Aerospace and Defense		14.04	%	SOFR+865			13,787		13,579		13,580
Skopima Consilio Parent, LLC	5/17/2028		Business Services		9.93	%	SOFR+450			1,300		1,274		1,272
Smile Brands Inc.	10/14/2025		Healthcare and Pharmaceuticals		9.70	%	SOFR+450			11,796		11,739		10,598
Solutionreach, Inc.	7/17/2025		Healthcare and Pharmaceuticals		12.37	%	SOFR+700			4,582		4,577		4,563
Spendmend Holdings LLC	3/1/2028		Healthcare Technology		11.04	%	SOFR+565			4,112		4,047		4,022
STV Group Incorporated	12/11/2026		Construction and Building		10.67	%	SOFR+535			9,075		9,025		8,894
Summit Behavioral Healthcare, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.43	%	SOFR+475			1,786		1,696		1,779
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)	8/16/2027		Aerospace and Defense		11.49	%	SOFR+600			14,738		14,540		14,575
Team Services Group, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.75	%	SOFR+500			346		333		339
Teneo Holdings LLC	7/18/2025		Business Services		10.67	%	SOFR+535			2,262		2,261		2,259
The Aegis Technologies Group, LLC	10/31/2025		Aerospace and Defense		12.04	%	SOFR+665			5,602		5,560		5,518
The Bluebird Group LLC	7/27/2026		Professional Services		12.79	%	SOFR+700			5,403		5,336		5,382
The Vertex Companies, LLC	8/31/2027		Construction and Engineering		11.72	%	SOFR+635			7,716		7,591		7,656
TPC Canada Parent, Inc. and TPC US Parent, LLC	11/24/2025		Consumer Goods: Non-Durable		10.95	%	SOFR+565			8,654		8,556		8,654
TWS Acquisition Corporation	6/16/2025		Diversified Consumer Services		11.80	%	SOFR+625			4,316		4,310		4,316
Tyto Athene, LLC	4/1/2028		IT Services		10.90	%	SOFR+550			14,670		14,565		13,379
Urology Management Holdings, Inc.	6/15/2026		Healthcare and Pharmaceuticals		11.79	%	SOFR+665			6,892		6,775		6,749
Walker Edison Furniture Company LLC	3/31/2027		Wholesale		12.18	%	SOFR+685			3,521		3,521		3,521
Walker Edison Furniture Company LLC - Junior Revolving Credit Facility	3/31/2027		Wholesale		11.68	%	SOFR+635			1,667		1,667		1,667
Walker Edison Furniture Company LLC - DDTL - Unfunded (3)	3/31/2027		Wholesale							333		-		-
Wildcat Buyerco, Inc.	2/27/2026		Electronic Equipment, Instruments, and Components		10.54	%	SOFR+515			10,565		10,491		10,460
Zips Car Wash, LLC	3/1/2024		Automobiles		12.67	%	SOFR+735			16,732		16,660		16,188

Total First Lien Secured Debt												801,215		783,598
Equity Securities - 3.9%
New MPE Holdings, LLC		—	Media: Diversified and Production		—			—		-		-		495
Walker Edison Furniture - Common Equity		—	Wholesale							36		3,393		1,766
Total Equity Securities												3,393		2,261
Total Investments - 1,351.4%												804,608		785,859
Cash and Cash Equivalents - 133.2%
BlackRock Federal FD Institutional 30												77,446		77,446
Total Cash and Cash Equivalents												77,446		77,446
Total Investments and Cash Equivalents —1,484.6%											$	882,054	$	863,305
Liabilities in Excess of Other Assets — (1,384.6)%														(805,155	)
Members' Equity—100.0%													$	58,150

(1)

(2)

Valued based on PSSL’s accounting policy.

(3)

(4)

Security currently on interest non-accrual status.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

Below are the consolidated statements of assets and liabilities for PSSL ($ in thousands):



		December 31, 2023
		(Unaudited)			September 30, 2023
Assets
Investments at fair value (amortized cost—$847,548 and $804,608, respectively)	$		836,857	$		785,859
Cash and cash equivalents (cost—$36,339 and $77,446, respectively)			36,339			77,446
Interest receivable			5,652			5,179
Due from affiliate			394			436
Prepaid expenses and other assets			151			490
Total assets			879,393			869,410
Liabilities
Credit facility payable			75,600			48,600
2032 Asset-backed debt, net (par—$246,000)			244,125			243,973
2035 Asset-backed debt, net (par—$246,000)			243,596			243,483
Notes payable to members			240,100			240,100
Interest payable on Credit facility and asset backed debt			9,105			14,291
Payable for investments purchased			—			13,466
Interest payable on notes to members			6,532			6,488
Accrued expenses			759			859
Total liabilities			819,817			811,260
Commitments and contingencies(1)
Members' equity			59,576			58,150
Total liabilities and members' equity	$		879,393	$		869,410

(1)

As of December 31, 2023 and September 30, 2023, PSSL had unfunded commitments to fund investments of $1.6 million and $1.1 million, respectively.

Below are the consolidated statements of operations for PSSL ($ in thousands):



	Three months ended December 31,
	2023			2022
Investment income:
Interest	$	26,048		$	19,617
Other income		177			110
Total investment income		26,225			19,727
Expenses(1):
Interest and expense on credit facility and asset-backed debt		13,398			8,641
Interest expense on notes to members		8,220			6,810
Administration fees		558			508
General and administrative expenses		262			300
Total expenses		22,438			16,259
Net investment income		3,787			3,468
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on investments		(6,420	)		(70	)
Net change in unrealized appreciation (depreciation) on investments		8,059			(5,800	)
Net realized and unrealized gain (loss) on investments		1,639			(5,870	)
Net increase (decrease) in members' equity resulting from operations	$	5,426		$	(2,402	)

(1) No management or incentive fees are payable by PSSL. If any fees were to be charged, they would be separately disclosed in the consolidated statement of operations.

5. FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value, as defined under ASC 820, is the price that we would receive upon selling an investment or pay to transfer a liability in an orderly transaction to a market participant in the principal or most advantageous market for the investment or liability. ASC 820 emphasizes that valuation techniques maximize the use of observable market inputs and minimize the use of unobservable inputs. Inputs refer broadly to the assumptions that market participants would use in pricing an asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs reflect the assumptions market participants would use in pricing an asset or liability based on market data obtained from sources independent of us. Unobservable inputs reflect the assumptions market participants would use in pricing an asset or liability based on the best information available to us on the reporting period date.

ASC 820 classifies the inputs used to measure these fair values into the following hierarchies:


Level 1:	Inputs that are quoted prices (unadjusted) in active markets for identical assets or liabilities, accessible by us at the measurement date.
Level 2:	Inputs that are quoted prices for similar assets or liabilities in active markets, or that are quoted prices for identical or similar assets or liabilities in markets that are not active and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term, if applicable, of the financial instrument.
Level 3:	Inputs that are unobservable for an asset or liability because they are based on our own assumptions about how market participants would price the asset or liability.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Generally, most of our investments, our 2031 Asset-Backed Debt, 2023 Notes and our Credit Facility are classified as Level 3. Our 2026 Notes are classified as Level 2 as they are financial instruments with readily observable market inputs. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and those differences may be material.

The inputs into the determination of fair value may require significant management judgment or estimation. Even if observable market data is available, such information may be the result of consensus pricing information, disorderly transactions or broker quotes which include a disclaimer that the broker would not be held to such a price in an actual transaction. The non-binding nature of consensus pricing and/or quotes accompanied by disclaimer would result in classification as Level 3 information, assuming no additional corroborating evidence were available. Corroborating evidence that would result in classifying these non-binding broker/dealer bids as a Level 2 asset includes observable orderly market-based transactions for the same or similar assets or other relevant observable market-based inputs that may be used in pricing an asset.

Our investments are generally structured as floating rate loans, mainly first lien secured debt, but also may include second lien secured debt, subordinated debt and equity investments. The transaction price, excluding transaction costs, is typically the best estimate of fair value at inception. Ongoing reviews by our Investment Adviser and independent valuation firms are based on an assessment of each underlying investment, incorporating valuations that consider the evaluation of financing and sale transactions with third parties, expected cash flows and market-based information including comparable transactions, performance multiples and yields, among other factors. These non-public investments valued using unobservable inputs are included in Level 3 of the fair value hierarchy.

A review of fair value hierarchy classifications is conducted on a quarterly basis. Changes in our ability to observe valuation inputs may result in a reclassification for certain financial assets or liabilities.

In addition to using the above inputs to value cash equivalents, investments, our 2023 Notes, our 2026 Notes, our 2031 Asset-Backed Debt and our Credit Facility, we employ the valuation policy approved by our board of directors that is consistent with ASC 820. Consistent with our valuation policy, we evaluate the source of inputs, including any markets in which our investments are trading, in determining fair value. See Note 2.

As outlined in the table below, some of our Level 3 investments using a market approach valuation technique are valued using the average of the bids from brokers or dealers. The bids include a disclaimer, may not have corroborating evidence, may be the result of a disorderly transaction and may be the result of consensus pricing. The Investment Adviser assesses the source and reliability of bids from brokers or dealers. If the board of directors has a bona fide reason to believe any such bids do not reflect the fair value of an investment, it may independently value such investment by using the valuation procedure that it uses with respect to assets for which market quotations are not readily available. In accordance with ASC 820, we do not categorize any investments for which fair value is measured using the net asset value per share as a practical expedient within the fair value hierarchy.

The remainder of our investment portfolio and our long-term Credit Facility are valued using a market comparable or an enterprise market value technique. With respect to investments for which there is no readily available market value, the factors that the board of directors may take into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments, its earnings and discounted cash flow, the markets in which the portfolio company does business, comparison to publicly traded securities, discounted for lack of marketability and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, the pricing indicated by the external event, excluding transaction costs, is used to corroborate the valuation. When using earnings multiples to value a portfolio company, the multiple used requires the use of judgment and estimates in determining how a market participant would price such an asset. These non-public investments using unobservable inputs are included in Level 3 of the fair value hierarchy. Generally, the sensitivity of unobservable inputs or combination of inputs such as industry comparable companies, market outlook, consistency, discount rates and reliability of earnings and prospects for growth, or lack thereof, affects the multiple used in pricing an investment. As a result, any change in any one of those factors may have a significant impact on the valuation of an investment. Generally, an increase in a market yield will result in a decrease in the valuation of a debt investment, while a decrease in a market yield will have the opposite effect. Generally, an increase in an earnings before interest, taxes, depreciation and amortization, or EBITDA, multiple will result in an increase in the valuation of an investment, while a decrease in an EBITDA multiple will have the opposite effect.

Our Level 3 valuation techniques, unobservable inputs and ranges were categorized as follows for ASC 820 purposes ($ in thousands):


Asset Category	Fair value at December 31, 2023		Valuation Technique	Unobservable Input	Range of Input (Weighted Average) (1)
First lien	$	30,609	Market Comparable	Broker/Dealer bids or quotes	N/A
First lien		1,054,150	Market Comparable	Market yield	8.4% - 27.1% (12.2%)
First lien		5,705	Enterprise Market Value	EBITDA multiple	7.8x
Second lien		150	Market Comparable	Market yield	14.0%
Second lien		—	Enterprise Market Value	EBITDA multiple	6.3x
Equity		118,522	Enterprise Market Value	EBITDA multiple	.5x - 17.5x (11.8x)
Equity		33	Enterprise Market Value	DLOM(2)	14.3%
Total Level 3 investments	$	1,209,169
Long-Term Credit Facility	$	260,917	Market Comparable	Market yield	2.1%

____________________________________________

(1)

The weighted averages disclosed in the table above were weighted by their relative fair value.

(2)

DLOM is defined as discount for lack of marketability.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)


Asset Category	Fair value at September 30, 2023		Valuation Technique	Unobservable Input	Range of Input (Weighted Average) (1)
First lien	$	25,521	Market Comparable	Broker/Dealer bids or quotes	N/A
First lien		875,133	Market Comparable	Market Yield	10.0% - 25.0% (12.6%)
First lien		5,512	Enterprise Market Value	EBITDA multiple	2.8x - 7.5x (7.4x)
Second lien		149	Market Comparable	Market Yield	14.8%
Second lien		—	Enterprise Market Value	EBITDA multiple	6.0x
Equity		100,489	Enterprise Market Value	EBITDA multiple	3.4x - 17.7x (12.1x)
Equity		144	Enterprise Market Value	DLOM(2)	27.9%
Total Level 3 investments	$	1,006,948
Long-Term Credit Facility and 2023 Notes	$	85,619	Market Comparable	Market Yield	2.3%

(1)

The weighted averages disclosed in the table above were weighted by their relative fair value.

(2)

DLOM is defined as discount for lack of marketability.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

Our investments, cash and cash equivalents, Credit Facility, 2023 Notes, 2026 Notes and 2031 Asset-Backed Debt were categorized as follows in the fair value hierarchy for ASC 820 purposes ($ in thousands):


	Fair Value at December 31, 2023
Description	Fair Value		Level 1		Level 2		Level 3		Measured at Net Asset Value (1)
First lien	$	1,090,464	$	—	$	—	$	1,090,464	$	—
Second lien		150		—		—		150		—
Equity		180,313		—		—		118,555		61,758
Total investments		1,270,927		—		—		1,209,169		61,758
Cash and cash equivalents		75,826		75,826		—		—		—
Total investments and cash and cash equivalents	$	1,346,753	$	75,826	$	—	$	1,209,169	$	61,758
Credit Facility payable	$	260,917	$	—	$	—	$	260,917	$	—
2026 Notes payable (2)		183,248		—		183,248		—		—
2031 Asset-Backed Debt(2)		226,917		—		—		226,917		—
Total debt	$	671,082	$	—	$	183,248	$	487,834	$	—

(1)

In accordance with ASC Subtopic 820-10, Fair Value Measurements and Disclosures, or ASC 820-10, our equity investment in PSSL and PTSF are measured using the net asset value per share (or its equivalent) as a practical expedient for fair value, and thus have not been classified in the fair value hierarchy.

(2)

We elected not to apply the fair value option allowed by ASC 825-10 to the 2026 Notes and the 2031 Asset-Backed Debt and thus the balance reported in the Consolidated Statement of Assets and Liabilities represents the carrying value, which approximates the fair value.


	Fair Value at September 30, 2023
Description	Fair Value		Level 1		Level 2		Level 3		Measured at Net Asset Value (1)
First lien	$	906,166	$	—	$	—	$	906,166	$	—
Second lien		149		—		—		149		—
Equity		160,859		—		—		100,633		60,226
Total investments		1,067,174		—		—		1,006,948		60,226
Cash and cash equivalents		100,555		100,555		—		—		—
Total investments and cash and cash equivalents	$	1,167,729	$	100,555	$	—	$	1,006,948	$	60,226
Credit Facility payable	$	9,400	$	—	$	—	$	9,400	$	—
2023 Notes payable		76,219		—		—		76,219		—
2026 Notes payable (2)		183,054		—		183,054		—		—
2031 Asset-Backed Debt(2)		226,759		—		—		226,759		—
Total debt	$	495,432	$	—	$	183,054	$	312,378	$	—

(1)

In accordance with ASC Subtopic 820-10, Fair Value Measurements and Disclosures, or ASC 820-10, our equity investment in PSSL and PTSF is measured using the net asset value per share (or its equivalent) as a practical expedient for fair value, and thus has not been classified in the fair value hierarchy.

(2)

The tables below show a reconciliation of the beginning and ending balances for fair valued investments measured using significant unobservable inputs (Level 3)

($ in thousands):


	Three Months Ended December 31, 2023
Description	First Lien			Second lien, subordinated debt and equity investments			Totals
Beginning balance	$	906,166		$	100,782		$	1,006,948
Net realized gain (loss)		(4,304	)		1,215			(3,089	)
Net change in unrealized appreciation (depreciation)		5,478			(858	)		4,620
Purchases, PIK interest, net discount accretion and non-cash exchanges		288,248			18,950			307,198
Sales, repayments and non-cash exchanges		(105,124	)		(1,384	)		(106,508	)
Transfers in and/or out of Level 3		—			—			—
Ending balance	$	1,090,464		$	118,705		$	1,209,169
Net change in unrealized appreciation (depreciation) reported within the net change in unrealized appreciaiton (depreciation) on investments in our consolidated statements of operations attributable to our Level 3 assets still held at the reporting date.	$	(1,085	)	$	295		$	(790	)

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)


	Three Months Ended December 31, 2022
Description	First Lien			Second lien, subordinated debt and equity investments			Totals
Beginning balance	$	1,009,642		$	95,285		$	1,104,927
Net realized gain (loss)		50			13			63
Net change in unrealized appreciation (depreciation)		(7,399	)		(3,446	)		(10,845	)
Purchases, PIK interest, net discount accretion and non-cash exchanges		58,636			4,031			62,667
Sales, repayments and non-cash exchanges		(62,720	)		(278	)		(62,998	)
Transfers in and/or out of Level 3		—			—			—
Ending balance	$	998,209		$	95,605		$	1,093,814
Net change in unrealized appreciation (depreciation) reported within the net change in unrealized appreciaiton (depreciation) on investments in our consolidated statements of operations attributable to our Level 3 assets still held at the reporting date.	$	(4,830	)	$	(3,368	)	$	(8,198	)

The table below shows a reconciliation of the beginning and ending balances for liabilities recognized at fair value and measured using significant unobservable inputs (Level 3)($ in thousands):


	Three months ended December 31,
Long-Term Credit Facility and 2023 Notes	2023			2022
Beginning balance (cost – $85,619 and $168,830, respectively)	$	85,619		$	167,563
Net change in unrealized (depreciation) appreciation included in earnings		62			125
Borrowings		251,455			30,000
Repayments		(76,219	)		—
Net realized (gain) loss		—			—
Transfers in and/or out of Level 3		—			—
Ending balance (cost – $260,855 and $259,277, respectively)	$	260,917		$	197,688

As of December 31, 2023, we had outstanding non-U.S. dollar borrowings on our Credit Facility. Net change in fair value from currency translation on outstanding borrowings is listed below ($ in thousands):


Foreign Currency	Amount Borrowed		Borrowing Cost		Current Value		Reset Date	Change in Fair Value
Canadian Dollar	$	2,000	$	1,455		1,517	1/1/2024		62

As of September 30, 2023 we did not have any outstanding non-U.S. dollar borrowings on the Credit Facility.

Generally, the carrying value of our consolidated financial liabilities approximates fair value. We have adopted the principles under ASC Subtopic 825-10, Financial Instruments, or ASC 825-10, which provides companies with an option to report selected financial assets and liabilities at fair value, and made an irrevocable election to apply ASC 825-10 to the Credit Facility and the 2023 Notes. We elected to use the fair value option for the Credit Facility and the 2023 Notes to align the measurement attributes of both our assets and liabilities while mitigating volatility in earnings from using different measurement attributes. Due to that election and in accordance with GAAP, we did not incur any expenses relating to amendment costs on the Credit Facility during both the three months ended December 31, 2023 and 2022. ASC 825-10 establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect on earnings of a company’s choice to use fair value. ASC 825-10 also requires entities to display the fair value of the selected assets and liabilities on the face of the Consolidated Statements of Assets and Liabilities and changes in fair value of the Credit Facility and the 2023 Notes are reported in our Consolidated Statements of Operations. We elected not to apply ASC 825-10 to any other financial assets or liabilities, including our 2026 Notes and the 2031 Asset-Backed Debt.

For the three months ended December 31, 2023 and 2022, the Credit Facility and the 2023 Notes had a net change in unrealized appreciation (depreciation) of less than $0.1 million and $(2.1) million, respectively. As of December 31, 2023 and September 30, 2023, the net unrealized appreciation (depreciation) on the Credit Facility and the 2023 Notes totaled $0.1 million and zero, respectively. We use a nationally recognized independent valuation service to measure the fair value of the Credit Facility in a manner consistent with the valuation process that our board of directors uses to value our investments. Our 2023 Notes traded on the TASE and were fully paid off during the quarter.

6. TRANSACTIONS WITH AFFILIATED COMPANIES

An affiliated portfolio company is a company in which we have ownership of 5% or more of its voting securities. A portfolio company is generally presumed to be a non-controlled affiliate when we own at least 5% but less than 25% of its voting securities and a controlled affiliate generally when we own more than 25% of its voting securities. Transactions related to our funded investments with both controlled and non-controlled affiliates for the three months ended December 31, 2023 were as follows ($ in thousands):


Name of Investment	Fair Value at September 30, 2023	Gross Additions	Sale of/ Distribution from Affiliates	Net Change in Unrealized Appreciation (Depreciation)	Fair Value at December 31, 2023	Interest Income	Dividend/ Other Income	Net Realized Gains (Losses)
Controlled Affiliates
Marketplace Events, LLC	$34,028	$392	$—	$(305)	$34,115	$1,241	$—	$—
PennantPark Senior Secured
Loan Fund I LLC *	260,969	—	—	1,248	262,217	7,193	3,500	—
Total Controlled Affiliates	$294,997	$392	$—	$943	$296,332	$8,434	$3,500	$—

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

* We and Kemper are the members of PSSL, a joint venture formed as a Delaware limited liability company that is not consolidated by us for financial reporting purposes. The members of PSSL make investments in PSSL in the form of first lien secured debt and equity interests, and all portfolio and other material decisions regarding PSSL must be submitted to PSSL’s board of directors or investment committee, both of which are comprised of two members appointed by each of us and Kemper. Because management of PSSL is shared equally between us and Kemper, we do not believe we control PSSL for purposes of the 1940 Act or otherwise.

7. CHANGE IN NET ASSETS FROM OPERATIONS PER COMMON SHARE

The following information sets forth the computation of basic and diluted per share net increase (decrease) in net assets resulting from operations

($ in thousands, except per share data):


	Three Months Ended December 31,
	2023		2022
Numerator for net increase (decrease) in net assets resulting from operations	$	22,469	$	(1,620	)
Denominator for basic and diluted weighted average shares		58,734,702		45,368,844
Basic and diluted net increase in net assets per share resulting from operations	$	0.38	$	(0.04	)

8. CASH AND CASH EQUIVALENTS

Cash equivalents represent cash in money market funds pending investment in longer-term portfolio holdings and for other general purposes. Our portfolio may consist of temporary investments in U.S. Treasury Bills (of varying maturities), repurchase agreements, money market funds or repurchase agreement-like treasury securities. These temporary investments with original maturities of 90 days or less are deemed cash equivalents and are included in the Consolidated Schedule of Investments. At the end of each fiscal quarter, we may take proactive steps to preserve investment flexibility for the next quarter by investing in cash equivalents, which is dependent upon the composition of our total assets at quarter-end. We may accomplish this in several ways, including purchasing U.S. Treasury Bills and closing out positions on a net cash basis after quarter-end, temporarily drawing down on the Credit Facility, or utilizing repurchase agreements or other balance sheet transactions as are deemed appropriate for this purpose. These amounts are excluded from average adjusted gross assets for purposes of computing the Investment Adviser’s management fee. U.S. Treasury Bills with maturities greater than 60 days from the time of purchase are valued consistent with our valuation policy. As of December 31, 2023 and September 30, 2023, cash and cash equivalents consisted of money market funds in the amounts of $75.8 million and $100.6 million at fair value, respectively.

9. FINANCIAL HIGHLIGHTS

Below are the financial highlights ($ in thousands, except per share data):


	Three Months Ended December 31,
	2023			2022
Per Share Data:
Net asset value, beginning of period	$	11.13		$	11.62
Net investment income (1)		0.33			0.30
Net change in realized and unrealized gain (loss) (1)		0.05			(0.34	)
Net increase (decrease) in net assets resulting from operations (1)		0.38			(0.04	)
Distributions to stockholders (1), (2)		(0.31	)		(0.29	)
Accretive effect of common stock issuance		0.00			0.01
Net asset value, end of period	$	11.20		$	11.30
Per share market value, end of period	$	12.10		$	10.98
Total return *(3)		16.68	%	17.29%
Shares outstanding at end of period		58,734,702			45,431,815
Ratios** / Supplemental Data:
Ratio of operating expenses to average net assets** (4)		5.86	%		5.91	%
Ratio of debt related expenses to average net assets** (5)		5.47	%		7.53	%
Ratio of total expenses to average net assets** (5)		11.32	%		13.44	%
Ratio of net investment income to average net assets** (5)		11.89	%		10.48	%
Net assets at end of period	$	658,013		$	513,530
Weighted average debt outstanding	$	528,462		$	688,165
Weighted average debt per share (1)	$	9.00		$	15.17
Asset coverage per unit (6)	$	1,972		$	1,734
Portfolio turnover rate*		7.98	%		4.04	%

Note: The expense and investment income ratios above do not reflect the Company's proportionate share of income and expenses of PSSL and PTSF

* Not annualized for periods less than one year.

** Re-occuring investment income and expenses included in these ratios are annualized for periods less than one year

(1)

Based on the weighted average shares outstanding for the respective periods.

(2)

The tax status of distributions is calculated in accordance with income tax regulations, which may differ from amounts determined under GAAP, and reported on Form 1099-DIV each calendar year.

(3)

Based on the change in market price per share during the periods and assumes distributions, if any, are reinvested.

(4)

Excludes debt-related costs.

(5)

Includes interest and expenses on debt (annualized) as well as Credit Facility amendment and debt issuance costs, if any, (not annualized).

(6)

The asset coverage ratio for a class of senior securities representing indebtedness is calculated on our consolidated total assets, less all liabilities and indebtedness not represented by senior securities, divided by the senior securities representing indebtedness at par (changed from fair value). This asset coverage ratio is multiplied by $1,000 to determine the asset coverage per unit.

10. DEBT

The annualized weighted average cost of debt for the three months ended December 31, 2023 and 2022, inclusive of the fee on the undrawn commitment on the Credit Facility, amendment costs and debt issuance costs, was 6.8% and 5.8%, respectively.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

On April 5, 2018, our board of directors approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the Consolidated Appropriations Act of 2018 (which includes the Small Business Credit Availability Act, or SBCAA). As a result, the asset coverage requirement applicable to us for senior securities was reduced from 200% (i.e., $1 of debt outstanding for each $1 of equity) to 150% (i.e., $2 of debt outstanding for each $1 of equity), effective as of April 5, 2019, subject to compliance with certain disclosure requirements. As of December 31, 2023 and September 30, 2023, our asset coverage ratio, as computed in accordance with the 1940 Act, was 197% and 230%, respectively.

Credit Facility

Funding I’s multi-currency Credit Facility with affiliates of Truist Bank, or the Lenders, was $386.0 million as of December 31, 2023, subject to satisfaction of certain conditions and the regulatory restrictions that the 1940 Act imposes on us as a BDC, has an interest rate spread above SOFR (or an alternative risk-free floating interest rate index) of 236 basis points, a maturity date of August 2026 and a revolving period that ends in August 2024. As of December 31, 2023 and September 30, 2023, Funding I had $260.9 million and $9.4 million of outstanding borrowings under the Credit Facility, respectively. The Credit Facility had a weighted average interest rate of 7.7% and 7.7%, exclusive of the fee on undrawn commitments as of December 31, 2023 and September 30, 2023, respectively. As of December 31, 2023 and September 30, 2023, we had $125.1 million and $376.6 million of unused borrowing capacity under the Credit Facility, respectively, subject to leverage and borrowing base restrictions.

During the revolving period, the Credit Facility bears interest at SOFR (or an alternative risk-free floating interest rate index) plus 236 basis points and, after the revolving period, the rate will reset to Base Rate (or an alternative risk-free floating interest rate index) plus 250 basis points for the remaining two years, maturing in August 2026. The Credit Facility is secured by all of the assets of Funding I. Both we and Funding I have made customary representations and warranties and are required to comply with various covenants, reporting requirements and other customary requirements for similar credit facilities.

The Credit Facility contains covenants, including, but not limited to, restrictions of loan size, industry requirements, average life of loans, geographic and individual portfolio concentrations, minimum portfolio yield and loan payment frequency. Additionally, the Credit Facility requires the maintenance of a minimum equity investment in Funding I and income ratio as well as restrictions on certain payments and issuance of debt. The Credit Facility compliance reporting is prepared on a basis of accounting other than GAAP. As of December 31, 2023, we were in compliance with the covenants relating to the Credit Facility.

We own 100% of the equity interest in Funding I and treat the indebtedness of Funding I as our leverage. Our Investment Adviser serves as collateral manager to Funding I under the Credit Facility.

Our interest in Funding I (other than the management fee) is subordinate in priority of payment to every other obligation of Funding I and is subject to certain payment restrictions set forth in the Credit Facility. We may receive cash distributions on our equity interests in Funding I only after it has made all required payments of (1) cash interest and, if applicable, principal to the Lenders, (2) administrative expenses and (3) claims of other unsecured creditors of Funding I. The Investment Adviser has irrevocably directed that any management fee owed with respect to such services is to be paid to the Company so long as the Investment Adviser remains the collateral manager.

2023 Notes

In November 2017, we issued $138.6 million aggregate principal amount of our 2023 Notes that matured on December 15, 2023. The 2023 Notes were issued pursuant to a deed of trust between the Company and Mishmeret Trust Company, Ltd., as trustee, in November 2017. In connection with this offering, we have dual listed our common stock on the TASE.

The 2023 Notes paid interest at a rate of 4.3% per year. As a result of the downgrade of the 2023 Notes from “ilA+” to “ilA-” in March 2020, the interest rate of the 2023 Notes was increased to 4.3% from 3.8%. Interest on the 2023 Notes was payable semi-annually in arrears on June 15 and December 15 of each year, commencing June 15, 2018. The principal on the 2023 Notes was payable in four annual installments as follows: 15% of the original principal amount on December 15, 2020, 15% of the original principal amount on December 15, 2021, 15% of the original principal amount on December 15, 2022 and 55% of the original principal amount on December 15, 2023. On December 15, 2023, the remaining outstanding 2023 Notes were repaid in full.

2026 Notes

In March 2021 and in October 2021, we issued $100.0 million and $85.0 million, respectively, in aggregate principal amount of $185.0 million of our 2026 Notes at a public offering price per note of 99.4% and 101.5%, respectively. Interest on the 2026 Notes is paid semi-annually on April 1 and October 1 of each year, at a rate of 4.25% per year, commencing October 1, 2021. The 2026 Notes mature on April 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes are our general, unsecured obligations and rank equal in right of payment with all of our existing and future senior unsecured indebtedness. The 2026 Notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all of our existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes on any securities exchange or automated dealer quotation system.

2031 Asset-Backed Debt

In September 2019, the Company completed the $301.4 million term debt securitization. Term debt securitizations, also known as CLOs, are a form of secured financing incurred by the Company, which is consolidated by the Company and subject to the Company’s asset coverage requirements. The 2031 Asset-Backed Debt was issued by the Securitization Issuer. The 2031 Asset-Backed Debt is secured by the middle market loans, participation interests in middle market loans and other assets of the Securitization Issuer. The Debt Securitization was executed through (A) a private placement of: (i) $78.5 million Class A-1 Senior Secured Floating Rate Loans maturing 2031, which bear interest at the three-month SOFR plus 1.8%, (ii) $15.0 million Class A-2 Senior Secured Fixed Rate Notes due 2031, which bear interest at 3.7%, (iii) $14.0 million Class B-1 Senior Secured Floating Rate Notes due 2031, which bear interest at the three-month SOFR plus 2.9%, (iv) $16.0 million Class B-2 Senior Secured Fixed Rate Notes due 2031, which bear interest at 4.3%, (v) $19.0 million Class C‑1 Secured Deferrable Floating Rate Notes due 2031, which bear interest at the three-month SOFR plus 4.0%, (vi) $8.0 million Class C-2 Secured Deferrable Fixed Rate Notes due 2031, which bear interest at 5.4%, and (vii) $18.0 million Class D Secured Deferrable Floating Rate Loans due 2031, which bear interest at the three-month SOFR plus 4.8% and (B) the borrowing of $77.5 million Class A‑1 Senior Secured Floating Rate Notes due 2031, which bear interest at the three-month SOFR plus 1.8%, under a credit agreement by and among the Securitization Issuers, as borrowers, various financial institutions, as lenders, and U.S. Bank National Association, as collateral agent and as loan agent. The annualized interest on the 2031 Asset-Backed Debt will be paid, to the extent of funds available. The reinvestment period of the Debt Securitization ends on October 15, 2023 and the 2031 Asset-Backed Debt is scheduled to mature on October 15, 2031.

PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS-(Continued)

December 31, 2023

(Unaudited)

Class D Secured Deferrable Floating Rate Notes issued by the Securitization Issuer, and a portion of the net cash proceeds received from the sale of the 2031 Asset-Backed Debt. The Preferred Shares of the Securitization Issuer do not bear interest and had a stated value of approximately $55.4 million at the closing of the Debt Securitization.

The 2031 Asset-Backed Debt is included in the Consolidated Statement of Assets and Liabilities as debt of the Company and the Class D Secured Deferrable Floating Rate Notes and the Preferred Shares of the Securitization Issuer were eliminated in consolidation. As of both December 31, 2023 and September 30, 2023, the Company had $228.0 million of 2031 Asset-Backed Debt outstanding with a weighted average interest rate of 7.2% and 7.1%, respectively. As of December 31, 2023 and September 30, 2023, the unamortized fees on the 2031 Asset-Backed Debt were $1.1 million and $1.2 million, respectively.

Our Investment Adviser serves as collateral manager to the Securitization Issuer pursuant to the Collateral Management Agreement. For so long as our Investment Adviser serves as collateral manager, it will elect to irrevocably waive any collateral management fee to which it may be entitled under the Collateral Management Agreement.

11. COMMITMENTS AND CONTINGENCIES

From time to time, we may be a party to legal proceedings, including proceedings relating to the enforcement of our rights under contracts with our portfolio companies. While the outcome of these legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations. Unfunded debt and equity investments, if any, are disclosed in the Consolidated Schedules of Investments. As of December 31, 2023 and September 30, 2023, we had $270.7 million and $155.5 million, respectively, in commitments to fund investments. Additionally, as described in Note 4, the Company had unfunded commitments of $39.4 million and $39.4 million to PSSL as of December 31, 2023 and September 30, 2023, respectively, that may be contributed primarily for the purpose of funding new investments approved by the PSSL board of directors or investment committee.

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors of PennantPark Floating Rate Capital Ltd. and its Subsidiaries

Results of Review of Interim Financial Statements

We have reviewed the accompanying consolidated statement of assets and liabilities of PennantPark Floating Rate Capital Ltd. and its Subsidiaries (the Company), including the consolidated schedule of investments, as of December 31, 2023, the related consolidated statements of operations and changes in net assets for the three-month periods ended December 31, 2023 and 2022 and cash flows for the three-month periods ended December 31, 2023 and 2022, and the related notes to
the consolidated financial statements (collectively, the interim financial information or financial statements). Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statement of assets and liabilities of the Company, including the consolidated schedule of investments, as of September 30, 2023, and the related consolidated statements of operations, changes in net assets, and cash flows for the year then ended (not presented herein); and in our report dated December 7, 2023, we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated statement of assets and liabilities, including the consolidated schedule of investments, as of September 30, 2023, is fairly stated, in all material respects, in relation to the consolidated statement of assets and liabilities, including the consolidated schedule of investments, from which it has been derived.

Emphasis of Matter

As discussed in Note 2 of the consolidated financial statements, the consolidated statements of cash flows for the three months ended December 31, 2022 has been restated to reclassify certain amounts presented within.

Basis for Review Results

These interim financial statements are the responsibility of the Company’s management. We conducted our reviews in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB). A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

/s/ RSM US LLP

New York, New York

February 7, 2024

Awareness Letter of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of PennantPark Floating Rate Capital Ltd. and its Subsidiaries

We have reviewed, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the unaudited interim financial information of PennantPark Floating Rate Capital Ltd. for the periods ended December 31, 2023 and 2022, as indicated in our report dated February 7, 2024; because we did not perform an audit, we expressed no opinion on that information.

We are aware that our report referred to above, which is included in your Quarterly Report on Form 10-Q for the quarter ended December 31, 2023, is incorporated by reference in Registration Statement No.333-268813 on Form N-2.

We are also aware that the aforementioned report, pursuant to Rule 436(c) under the Securities Act of 1933, is not considered a part of the Registration Statement prepared or certified by an accountant or a report prepared or certified by an accountant within the meaning of Sections 7 and 11 of that Act.

/s/ RSM US LLP

New York, New York

February 7, 2024

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS

This Report, including Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains statements that constitute forward-looking statements, which relate to us and our consolidated subsidiaries regarding future events or our future performance or future financial condition. These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our Company, our industry, our beliefs and our assumptions. The forward-looking statements contained in this Report involve risks and uncertainties, including statements as to:

•

our future operating results;

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our business prospects and the prospects of our prospective portfolio companies;

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changes in political, economic or industry conditions, the interest rate environment or conditions affecting the financial and capital markets that could result in changes to the value of our assets;

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the dependence of our future success on the general economy and its impact on the industries in which we invest;

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the impact of a protracted decline in the liquidity of credit markets on our business;

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the impact of investments that we expect to make;

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the impact of fluctuations in interest rates and foreign exchange rates on our business and our portfolio companies;

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our contractual arrangements and relationships with third parties;

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the valuation of our investments in portfolio companies, particularly those having no liquid trading market;

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the ability of our prospective portfolio companies to achieve their objectives;

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our expected financings and investments and ability to fund capital commitments to PSSL;

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the adequacy of our cash resources and working capital;

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the timing of cash flows, if any, from the operations of our prospective portfolio companies;

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the impact of price and volume fluctuations in the stock market;

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increasing levels of inflation, and its impact on us and our portfolio companies;

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the ability of our Investment Adviser to locate suitable investments for us and to monitor and administer our investments;

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the impact of future legislation and regulation on our business and our portfolio companies;

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the impact of the ongoing invasion of Ukraine by Russia other world economic and political issues; and

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the inability to develop and maintain effective internal control over financial reporting.

We use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. You should not place undue influence on the forward-looking statements as our actual results could differ materially from those projected in the forward-looking statements for any reason, including the factors in “Risk Factors” and elsewhere in this Report.

Although we believe that the assumptions on which these forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate, and, as a result, the forward-looking statements based on those assumptions also could be inaccurate. Important assumptions include our ability to originate new loans and investments, certain margins and levels of profitability and the availability of additional capital. In light of these and other uncertainties, the inclusion of a projection or forward-looking statement in this Report should not be regarded as a representation by us that our plans and objectives will be achieved.

We have based the forward-looking statements included in this Report on information available to us on the date of this Report, and we assume no obligation to update any such forward-looking statements. Although we undertake no obligation to revise or update any forward-looking statements in this Report, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that we may make directly to you or through reports that we in the future may file with the SEC, including reports on Form 10-Q/K and current reports on Form 8-K.

You should understand that under Section 27A(b)(2)(B) of the Securities Act and Section 21E(b)(2)(B) of the Exchange Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports we file under the Exchange Act.

The following analysis of our financial condition and results of operations should be read in conjunction with our Consolidated Financial Statements and the related notes thereto contained elsewhere in this Report.

Overview

PennantPark Floating Rate Capital Ltd. is a BDC whose objectives are to generate both current income and capital appreciation while seeking to preserve capital by investing primarily in floating rate loans and other investments made to U.S. middle-market companies.

We believe that floating rate loans to U.S. middle-market companies offer attractive risk-reward to investors due to a limited amount of capital available for such companies. We use the term “middle-market” to refer to companies with annual revenues between $50 million and $1 billion. Our investments are typically rated below

investment grade. Securities rated below investment grade are often referred to as “leveraged loans,” “high yield” securities or “junk bonds” and are often higher risk compared to debt instruments that are rated above investment grade and have speculative characteristics. However, when compared to junk bonds and other non-investment grade debt, senior secured floating rate loans typically have more robust capital-preserving qualities, such as historically lower default rates than junk bonds, represent the senior source of capital in a borrower’s capital structure and often have certain of the borrower’s assets pledged as collateral. Our debt investments may generally range in maturity from three to ten years and are made to U.S. and, to a limited extent, non-U.S. corporations, partnerships and other business entities which operate in various industries and geographical regions.

Under normal market conditions, we generally expect that at least 80% of the value of our managed assets will be invested in floating rate loans and other investments bearing a variable-rate of interest. We generally expect that first lien secured debt will represent at least 65% of our overall portfolio. We also generally expect to invest up to 35% of our overall portfolio opportunistically in other types of investments, including second lien secured debt and subordinated debt and, to a lesser extent, equity investments. We seek to create a diversified portfolio by generally targeting an investment size between $5 million and $30 million, on average, although we expect that this investment size will vary proportionately with the size of our capital base.

Our investment activity depends on many factors, including the amount of debt and equity capital available to middle-market companies, the level of merger and acquisition activity for such companies, the general economic environment and the competitive environment for the types of investments we make. We have used, and expect to continue to use, our debt capital, proceeds from the rotation of our portfolio and proceeds from public and private offerings of securities to finance our investment objectives.

Organization and Structure of PennantPark Floating Rate Capital Ltd.

PennantPark Floating Rate Capital Ltd., a Maryland corporation organized in October 2010, is a closed-end, externally managed, non-diversified investment company that has elected to be treated as a BDC under the 1940 Act. In addition, for federal income tax purposes we elected to be treated, and intend to qualify annually, as a RIC under the Code.

Our investment activities are managed by the Investment Adviser. Under our Investment Management Agreement, we have agreed to pay our Investment Adviser an annual base management fee based on our average adjusted gross assets as well as an incentive fee based on our investment performance. We have also entered into an Administration Agreement with the Administrator. Under our Administration Agreement, we have agreed to reimburse the Administrator for our allocable portion of overhead and other expenses incurred by the Administrator in performing its obligations under our Administration Agreement, including rent and our allocable portion of the costs of compensation and related expenses of our Chief Financial Officer, Chief Compliance Officer, Corporate Counsel and their respective staffs. Our board of directors, a majority of whom are independent of us, provides overall supervision of our activities, and the Investment Adviser supervises our day-to-day activities.

Revenues

We generate revenue in the form of interest income on the debt securities we hold and capital gains and dividends, if any, on investment securities that we may acquire in portfolio companies. Our debt investments, whether in the form of first lien secured debt, second lien secured debt or subordinated debt, typically have a term of three to ten years and bear interest at a floating or fixed rate. Interest on debt securities is generally payable quarterly or semiannually. In some cases, our investments provide for deferred interest payments or PIK interest. The principal amount of the debt securities and any accrued but unpaid interest generally becomes due at the maturity date. In addition, we may generate revenue in the form of amendment, commitment, origination, structuring or diligence fees, fees for providing significant managerial assistance and possibly consulting fees. Loan origination fees, OID and market discount or premium are capitalized and accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts. From time to time, the Company receives certain fees from portfolio companies, which may or may not be non-recurring in nature. Such fees include loan prepayment penalties, structuring fees and amendment fees and agency fees, and are recorded as other investment income when earned. Litigation settlements are accounted for in accordance with the gain contingency provisions of ASC Subtopic 450-30, Gain Contingencies, or ASC 450-30.

Expenses

Our primary operating expenses include the payment of a management fee and the payment of an incentive fee to our Investment Adviser, if any, our allocable portion of overhead under our Administration Agreement and other operating costs as detailed below. Our management fee compensates our Investment Adviser for its work in identifying, evaluating, negotiating, consummating and monitoring our investments. Additionally, we pay interest expense on the outstanding debt and unused commitment fees on undrawn amounts under our various debt facilities. We bear all other direct or indirect costs and expenses of our operations and transactions, including:

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the cost of calculating our NAV, including the cost of any third-party valuation services;

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the cost of effecting sales and repurchases of shares of our common stock and other securities;

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fees payable to third parties relating to, or associated with, making investments, including fees and expenses associated with performing due diligence and reviews of prospective investments or complementary businesses;

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expenses incurred by the Investment Adviser in performing due diligence and reviews of investments, including expenses incurred by the Investment Adviser payable to third parties (including agents and consultants) in monitoring our financial and legal affairs for and in monitoring our investments;

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transfer agent and custodial fees;

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fees and expenses associated with marketing efforts;

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federal and state registration fees and any exchange listing fees;

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federal, state, local and foreign taxes;

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independent directors’ fees and expenses;

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brokerage commissions;

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fidelity bond, directors and officers, errors and omissions liability insurance and other insurance premiums;

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direct costs such as printing, mailing, long distance telephone and staff;

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fees and expenses associated with independent audits and outside legal costs;

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costs associated with our reporting and compliance obligations under the 1940 Act and applicable federal and state securities laws; and

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all other expenses incurred by either the Administrator or us in connection with administering our business, including payments under our Administration Agreement that will be based upon our allocable portion of overhead, and other expenses incurred by the Administrator in performing its obligations under our Administration Agreement, including rent and our allocable portion of the costs of compensation and related expenses of our Chief Compliance Officer, Chief Financial Officer, Corporate Counsel and their respective staffs.

Generally, during periods of asset growth, we expect our general and administrative expenses to be relatively stable or to decline as a percentage of total assets and increase during periods of asset declines. Incentive fees, interest expense and costs relating to future offerings of securities would be additive to the expenses described above.

Restatement of Previously Issued Financial Statements

There was no impact from the error correction on net investment income or net increase (decrease) in net assets resulting from operations in total or on a per common share basis as reported on the consolidated statements of operations for the three months ended December 31, 2022. The corrections related to the prior year comparative cash flow statement amounts were reported in the quarter ended December 31, 2023.

As a result of the error in the classification and presentation of cash described above, we conducted an analysis to determine whether incentive-based compensation was erroneously awarded, thereby necessitating recovery under the Clawback Policy we adopted effective December 1, 2023. Because we do not pay or otherwise award incentive-based compensation to the Company’s executives, we concluded that the error did not result in erroneously-awarded incentive-based compensation, and therefore no compensation recovery is required.

PORTFOLIO AND INVESTMENT ACTIVITY

PennantPark Floating Rate Capital Ltd.

As of December 31, 2023, our portfolio totaled $1,270.9 million, and consisted of $1,090.5 million of first lien secured debt (including $210.1 million in PSSL), $0.2 million of second lien secured debt and $180.3 million of preferred and common equity (including $52.1 million in PSSL). Our debt portfolio consisted of approximately 100% variable-rate investments. As of December 31, 2023, we had one portfolio company on non-accrual, representing 0.1% and zero percent of our overall portfolio on a cost and fair value basis, respectively. As of December 31, 2023, the portfolio had net unrealized depreciation of $19.6 million. Our overall portfolio consisted of 141 companies with an average investment size of $9.0 million and had a weighted average yield on debt investments of 12.5%, and was invested 86% in first lien secured debt (including 17% in PSSL), less than 1% in second lien secured debt and 14% in preferred and common equity (including 4% in PSSL). As of December 31, 2023, approximately 100% of the investments held by PSSL were first lien secured debt.

As of September 30, 2023, our portfolio totaled $1,067.2 million and consisted of $r906.2 million of first lien secured debt (including $210.1 million in PSSL), $0.1 million of second lien secured debt and $160.9 million of preferred and common equity (including $50.9 million in PSSL). Our debt portfolio consisted of approximately 100% variable-rate investments. As of September 30, 2023, we had three portfolio companies on non-accrual, representing 0.9% and 0.2% of our overall portfolio on a cost and fair value basis, respectively. As of September 30, 2023, the portfolio had net unrealized depreciation of $25.7 million. Our overall portfolio consisted of 131 companies with an average investment size of $8.1 million, had a weighted average yield on debt investments of 12.6%, and was invested 85% in first lien secured debt (including 20% in PSSL), less than 1% in second lien secured debt and 15% in preferred and common equity (including 5% in PSSL). As of September 30, 2023, 99% of the investments held by PSSL were first lien secured debt.

For the three months ended December 31, 2023, we invested $302.6 million in 13 new and 34 existing portfolio companies at a weighted average yield on debt investments of 11.9%. For the three months ended December 31, 2023, sales and repayments of investments totaled $103.8 million, including $62.7 million of sales to PSSL.

For the three months ended December 31, 2022, we invested $65.6 million in four new and 29 existing portfolio companies at a weighted average yield on debt investments of 11.2%. For the three months ended December 31, 2022 sales and repayments of investments totaled $63.0 million, including $18.8 million of sales to PSSL.

PennantPark Senior Secured Loan Fund I LLC

As of December 31, 2023, PSSL’s portfolio totaled $836.9 million and consisted of 106 companies with an average investment size of $7.9 million and at a weighted average yield on debt investments of 12.1%. As of September 30, 2023, PSSL’s portfolio totaled $785.9 million, consisted of 105 companies with an average investment size of $7.5 million and at a weighted average yield on debt investments of 12.1%.

For the three months ended December 31, 2023, PSSL invested $75.7 million (including $62.7 million purchased from the Company) in four new and nine existing portfolio companies at a weighted average yield on debt investments of 12.3%. Sales and repayments of investments for the three months ended December 31, 2023 totaled $27.7 million.

For the three months ended December 31, 2022, PSSL invested $29.5 million (including $18.8 million purchased from the Company) in seven new and eight existing portfolio companies at a weighted average yield on debt investments of 11.1%. For the three months ended December 31, 2022 sales and repayments of investments totaled $28.8 million.

At-the-Market Offering

time through a sales agent in amounts and at times to be determined by us. Actual sales will depend on a variety of factors to be determined by us from time to time, including, market conditions and the trading price of our common stock. The Investment Adviser may, from time to time, in its sole discretion, pay some or all of the commissions payable under the equity distribution agreements or make additional supplemental payments to ensure that the sales price per share of our common stock in connection with all of the offerings made hereunder will not be less than our current NAV per share. Any such payments made by the Investment Adviser will not be subject to reimbursement by us.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of our Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of our assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of income and expenses during the reported periods. In the opinion of management, all adjustments, which are of a normal recurring nature, considered necessary for the fair presentation of financial statements have been included. Actual results could differ from these estimates due to changes in the economic and regulatory environment, financial markets and any other parameters used in determining such estimates and assumptions. We may reclassify certain prior period amounts to conform to the current period presentation. We have eliminated all intercompany balances and transactions. References to ASC serve as a single source of accounting literature. Subsequent events are evaluated and disclosed as appropriate for events occurring through the date the Consolidated Financial Statements are issued. In addition to the discussion below, we describe our critical accounting policies in the notes to our Consolidated Financial Statements. We discuss our critical accounting estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2023 Annual Report on Form 10-K. There have been no significant changes in our critical accounting estimates during the three months from those disclosed in our 2023 Annual Report on Form 10-K.

Investment Valuations

We expect that there may not be readily available market values for many of our investments which are or will be in our portfolio, and we value such investments at fair value as determined in good faith by or under the direction of our board of directors using a documented valuation policy and a consistently applied valuation process, as described in this Report. With respect to investments for which there is no readily available market value, the factors that the board of directors may take into account in pricing our investments at fair value include, as relevant, the nature and realizable value of any collateral, the portfolio company’s ability to make payments and its earnings and discounted cash flow, the markets in which the portfolio company does business, comparison to publicly traded securities and other relevant factors. When an external event such as a purchase transaction, public offering or subsequent equity sale occurs, we consider the pricing indicated by the external event to corroborate or revise our valuation. Due to the inherent uncertainty of determining the fair value of investments that do not have a readily available market value, the price used in an actual transaction may be different than our valuation and the difference may be material.

(1)

(2)

Preliminary valuation conclusions are then documented and discussed with the management of our Investment Adviser;

(3)

Our board of directors also engages independent valuation firms to conduct independent appraisals of our investments for which market quotations are not readily available or are readily available but deemed not reflective of the fair value of the investment. The independent valuation firms review management’s preliminary valuations in light of their own independent assessment and also in light of any market quotations obtained from an independent pricing service, broker, dealer or market maker;

(4)

(5)

Our board of directors generally uses market quotations to assess the value of our investments for which market quotations are readily available. We obtain these market values from independent pricing services or at the bid prices obtained from at least two brokers or dealers, if available, or otherwise from a principal market maker or a primary market dealer. The Investment Adviser assesses the source and reliability of bids from brokers or dealers. If the board of directors has a bona fide reason to believe any such market quote does not reflect the fair value of an investment, it may independently value such investments by using the valuation procedure that it uses with respect to assets for which market quotations are not readily available.

ASC 820 classifies the inputs used to measure these fair values into the following hierarchies:

Level 1: Inputs that are quoted prices (unadjusted) in active markets for identical assets or liabilities, accessible by us at the measurement date.

Level 2: Inputs that are quoted prices for similar assets or liabilities in active markets, or that are quoted prices for identical or similar assets or liabilities in markets that are not active and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term, if applicable, of the financial instrument.

Level 3: Inputs that are unobservable for an asset or liability because they are based on our own assumptions about how market participants would price the asset or liability.

On December 3, 2020, the SEC adopted Rule 2a-5 under the 1940 Act, which establishes an updated regulatory framework for determining fair value in good faith for purposes of the 1940 Act. The new rule clarifies how fund boards of directors can satisfy their valuation obligations and requires, among other things, the boards of directors to periodically assess material valuation risks and take steps to manage those risks. The rule also permits boards of directors, subject to board oversight and certain other conditions, to designate the fund’s investment adviser to perform fair value determinations. The new rule went into effect on March 8, 2021 and had a compliance date of September 8, 2022. We came into compliance with Rule 2a-5 under the 1940 Act before the compliance date. While our board of directors has not elected to designate the Investment Adviser as the valuation designee at this time, we have adopted certain revisions to our valuation policies and procedures in order comply with the applicable requirements of Rule 2a-5 under the 1940 Act.

Generally, the carrying value of our consolidated financial liabilities approximates fair value. We have adopted the principles ASC Subtopic 825-10, Financial Instruments, or ASC 825-10, which provides companies with an option to report selected financial assets and liabilities at fair value, and made an irrevocable election to apply ASC 825-10 to the Credit Facility and the 2023 Notes. We elected to use the fair value option for the Credit Facility and the 2023 Notes to align the measurement attributes of both our assets and liabilities while mitigating volatility in earnings from using different measurement attributes. Due to that election and in accordance with GAAP, we did not incur any expenses relating to amendment costs on the Credit Facility and debt issuance costs on the 2023 Notes during the three months ended December 31, 2023 and 2022, respectively. ASC 825-10 establishes presentation and disclosure requirements designed to facilitate comparisons between companies that choose different measurement attributes for similar types of assets and liabilities and to more easily understand the effect on earnings of a company’s choice to use fair value. ASC 825-10 also requires entities to display the fair value of the selected assets and liabilities on the face of the Consolidated Statements of Assets and Liabilities and changes in fair value of the Credit Facility and the 2023 Notes are reported in our Consolidated Statements of Operations. We elected not to apply ASC 825-10 to any other financial assets or liabilities, including the 2026 Notes and the 2031 Asset-Backed Debt.

For the three months ended December 31, 2023 and 2022, the Credit Facility and the 2023 Notes had a net change in unrealized appreciation (depreciation) of less than $0.1 million and $(2.1) million, respectively. As of December 31, 2023 and September 30, 2023, the net unrealized appreciation (depreciation) on the Credit Facility as applicable, and the 2023 Notes totaled $0.1 million and zero, respectively. We use a nationally recognized independent valuation service to measure the fair value of the Credit Facility in a manner consistent with the valuation process that our board of directors uses to value our investments. Our 2023 Notes traded on the TASE and were fully paid off during the quarter.

Revenue Recognition

We record interest income on an accrual basis to the extent that we expect to collect such amounts. For loans and debt investments with contractual PIK interest, which represents interest accrued and added to the loan balance that generally becomes due at maturity, we will generally not accrue PIK interest when the portfolio company valuation indicates that such PIK interest is not collectable. We do not accrue as a receivable interest on loans and debt investments if we have reason to doubt our ability to collect such interest. Loan origination fees, OID, market discount or premium and deferred financing costs on liabilities, which we do not fair value, are capitalized and then accreted or amortized using the effective interest method as interest income or, in the case of deferred financing costs, as interest expense. We record prepayment penalties on loans and debt investments as income. Dividend income, if any, is recognized on an accrual basis on the ex-dividend date to the extent that we expect to collect such amounts. From time to time, the Company receives certain fees from portfolio companies, which may or may not be non-recurring in nature. Such fees include loan prepayment penalties, structuring fees, amendment fees and agency fees, and are recorded as other investment income when earned.

Net Realized Gains or Losses and Net Change in Unrealized Appreciation or Depreciation

We measure realized gains or losses by the difference between the net proceeds from the repayment or sale and the amortized cost basis of the investment, using the specific identification method, without regard to unrealized appreciation or depreciation previously recognized, but considering unamortized upfront fees and prepayment penalties. Net change in unrealized appreciation or depreciation reflects the change in the fair values of our portfolio investments, our Credit Facility, the 2023 Notes during the reporting period, including any reversal of previously recorded unrealized appreciation or depreciation, when gains or losses are realized.

Foreign Currency Translation

Our books and records are maintained in U.S. dollars. Any foreign currency amounts are translated into U.S. dollars on the following basis:

Fair value of investment securities, other assets and liabilities – at the exchange rates prevailing at the end of the applicable period; and

Purchases and sales of investment securities, income and expenses – at the exchange rates prevailing on the respective dates of such transactions.

Payment -in-kind, or PIK Interest

We have investments in our portfolio which contain a PIK interest provision. PIK interest is added to the principal balance of the investment and is recorded as income. In order for us to maintain our ability to be subject to tax as a RIC, substantially all of this income must be paid out to stockholders in the form of dividends for federal income tax purposes, even though we may not have collected any cash with respect to interest on PIK securities.

Federal Income Taxes

We have elected to be treated and intend to qualify annually to maintain our election to be treated, as a RIC under Subchapter M of the Code. To maintain our RIC tax election, we must, among other requirements, meet certain annual source-of-income and quarterly asset diversification requirements. We also must annually distribute dividends for federal income tax purposes to our stockholders out of the assets legally available for distribution of an amount generally at least equal to 90% of the sum of our net ordinary income and realized net short-term capital gains in excess of realized net long-term capital losses, or investment company taxable income, determined without regard to any deduction for dividends paid.

Although not required for us to maintain our RIC tax status, in order to preclude the imposition of a 4% nondeductible federal excise tax imposed on RICs, we must distribute dividends for U.S. federal income tax purposes to our stockholders in respect of each calendar year of an amount at least equal to the sum of (1) 98% of our net ordinary income (subject to certain deferrals and elections) for the calendar year, (2) 98.2% of our capital gain net income (i.e., the excess, if any, of our capital gains over capital losses), adjusted for certain ordinary losses, generally for the one-year period ending on October 31 of the calendar year plus (3) any net ordinary income or capital gain net income for the preceding years that was not distributed during such years on which we did not incur any corporate income tax, or the Excise Tax Avoidance Requirement. In addition, although we may distribute realized net capital gains (i.e., net long-term capital gains in excess of net short-term capital losses), if any, at least annually, out of the assets legally available for such distributions in the manner described above, we have retained and may continue to retain such net capital gains or investment company taxable income, subject to maintaining our ability to be taxed as a RIC, in order to provide us with additional liquidity.

Because federal income tax regulations differ from GAAP, distributions in accordance with tax regulations may differ from net investment income and net realized gain recognized for financial reporting purposes. Differences between tax regulations and GAAP may be permanent or temporary. Permanent differences are reclassified among capital accounts in the Consolidated Financial Statements to reflect their appropriate tax character. Temporary differences arise when certain items of income, expense, gain or loss are recognized at some time in the future.

For the three months ended December 31, 2023 and 2022, we recorded a provision for taxes on net investment income of $0.2 million and $0.5 million, respectively, pertaining to federal excise tax.

We have formed and expect to continue to form certain taxable subsidiaries, including the Taxable Subsidiary, which are taxed as corporations. These taxable subsidiaries allow us to hold equity securities of certain portfolio companies treated as pass-through entities for U.S. federal income tax purposes while facilitating our ability to qualify as a RIC under the Code.

RESULTS OF OPERATIONS

Set forth below are the results of operations for the three months ended December 31, 2023 and 2022.

Investment Income

For the three months ended December 31, 2023, investment income was $38.0 million, which was attributable to $33.2 million from first lien secured debt and $4.8 million from other investments. For the three months ended December 31, 2022, investment income was $31.3 million, which was attributable to $27.6 million from first lien secured debt and $3.7 million from other investments. The increase in investment income compared to the same period in the prior year was primarily due to the increase in the cost yield of our debt portfolio.

Expenses

For the three months ended December 31, 2023, expenses totaled $18.5 million and were comprised of: $8.9 million of debt related interest and expenses, $3.0 million of base management fees, $4.9 million of performance-based incentive fees, $1.6 million of general and administrative expenses and $0.2 million of taxes. For the three months ended December 31, 2022, expenses totaled $17.6 million and were comprised of: $9.9 million of debt related interest and expenses, $2.9 million of base management fees, $3.4 million of performance-based incentive fees, $0.8 million of general and administrative expenses and $0.5 million of taxes. The increase in expenses compared to the same period in the prior year was primarily due to the increase in performance-based incentive fees as a result of higher pre-incentive fee net investment income.

Net Investment Income

For the three months ended December 31, 2023 and 2022, net investment income totaled $19.4 million or $0.33 per share, and $13.7 million or $0.30 per share, respectively. The increase in net investment income was primarily due to an increase in investment income partially offset by an increase in expenses compared to the same period in the prior year.

Net Realized Gains or Losses

For the three months ended December 31, 2023 and 2022, net realized gains (losses) totaled $(3.1) million and less than $0.1 million, respectively. The change in net realized gains (losses) compared to the same period in the prior year was primarily due to changes in the market conditions of our investments and the values at which they were realized.

Unrealized Appreciation or Depreciation on Investments, the Credit Facility and the 2023 Notes

For the three months ended December 31, 2023 and 2022, we reported net change in unrealized appreciation (depreciation) on investments of $6.2 million and $(16.8) million, respectively. As of December 31, 2023 and September 30, 2023, our net unrealized appreciation (depreciation) on investments totaled $(19.6) million and $(25.7) million, respectively. The net change in unrealized appreciation (depreciation) on our investments compared to the same period in the prior year was primarily due to the operating performance of the portfolio companies within our portfolio and changes in the capital market conditions of our investments.

For the three months ended December 31, 2023 and 2022, our Credit Facility and the 2023 Notes had a net change in unrealized appreciation (depreciation) of less than $0.1 million and $(2.1) million, respectively. As of December 31, 2023 and September 30, 2023, the net unrealized appreciation (depreciation) on the Credit Facility and the 2023 Notes totaled less than $0.1 million and zero, respectively. The net change in net unrealized appreciation or (depreciation) compared to the same period in the prior year was primarily due to changes in the capital markets.

Net Increase (Decrease) in Net Assets Resulting from Operations

For the three months ended December 31, 2023 and 2022, net increase (decrease) in net assets resulting from operations totaled $22.5 million or $0.38 per share and $(1.6) million, or $(0.04) per share, respectively. The net increase or (decrease) from operations compared to the same period in the prior year was primarily due to operating performance of our portfolio and changes in capital market conditions of our investments along with change in cost yield of our debt portfolio and costs of financing.

LIQUIDITY AND CAPITAL RESOURCES

Our liquidity and capital resources are derived primarily from cash flows from operations, including income earned, proceeds from investment sales and repayments, and proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations. As of December 31, 2023, in accordance with the 1940 Act, with certain limited exceptions, we are only allowed to borrow amounts such that we are in compliance with a 150% asset coverage ratio requirement after such borrowing.

On April 5, 2018, our board of directors approved the application of the modified asset coverage requirements set forth in Section 61(a)(2) of the 1940 Act, as amended by the Consolidated Appropriations Act of 2018 (which includes the SBCAA). As a result, the asset coverage requirement applicable to us for senior securities was reduced from 200% (i.e., $1 of debt outstanding for each $1 of equity) to 150% (i.e., $2 of debt outstanding for each $1 of equity), effective as of April 5, 2019, subject to compliance with certain disclosure requirements. As of December 31, 2023 and September 30, 2023, our asset coverage ratio, as computed in accordance with the 1940 Act, was 197% and 230%, respectively.

For the three months ended December 31, 2023 and 2022, the annualized weighted average cost of debt, inclusive of the fee on the undrawn commitment on the Credit Facility, amendment costs and debt issuance costs, was 6.8% and 5.7%, respectively. As of December 31, 2023 and September 30, 2023, we had $125.1 million and $376.6 million of unused borrowing capacity under the Credit Facility, as applicable, respectively, subject to leverage and borrowing base restrictions.

Funding I’s multi-currency Credit Facility with the Lenders was $386.0 million as of December 31, 2023 subject to satisfaction of certain conditions and regulatory restrictions that the 1940 Act imposes on us as a BDC, has an interest rate spread above SOFR (or an alternative risk-free floating interest rate index) of 236 basis points, a maturity date of August 2026 and a revolving period that ends in August 2024. As of December 31, 2023 and September 30, 2023, PennantPark Floating Rate Funding I, LLC, our wholly-owned subsidiary, borrowed $260.9 million and $9.4 million under the Credit Facility, respectively, and the weighted average interest rate, exclusive of the fee on undrawn commitments, was of 7.7% and 7.7%, respectively, exclusive of the fee on undrawn commitments.

During the revolving period, the Credit Facility bears interest at SOFR (or an alternative risk-free floating interest rate index) plus 236 basis points and, after the revolving period, the rate will reset to Base Rate (or an alternative risk-free floating interest rate index) plus 250 basis points for the remaining two years, maturing in August 2026. The Credit Facility is secured by all of the assets of Funding I. Both PennantPark Floating Rate Capital Ltd. and Funding I have made customary representations and warranties and are required to comply with various covenants, reporting requirements and other customary requirements for similar credit facilities.

The Credit Facility contains covenants, including but not limited to, restrictions of loan size, currency types and amounts, industry requirements, average life of loans, geographic and individual portfolio concentrations, minimum portfolio yield and loan payment frequency. Additionally, the Credit Facility requires the maintenance of a minimum equity investment in Funding I and income ratio as well as restrictions on certain payments and issuance of debt. The Credit Facility compliance reporting is prepared on a basis of accounting other than GAAP. As of December 31, 2023, we were in compliance with the covenants relating to our Credit Facility.

We own 100% of the equity interest in Funding I and treat the indebtedness of Funding I as our leverage. Our Investment Adviser serves as collateral manager to Funding I under the Credit Facility.

Our interest in Funding I (other than the management fee) is subordinate in priority of payment to every other obligation of Funding I and is subject to certain payment restrictions set forth in the Credit Facility. We may receive cash distributions on our equity interests in Funding I only after it has made (1) all required cash interest and, if applicable, principal payments to the Lenders, (2) required administrative expenses and (3) claims of other unsecured creditors of Funding I. We cannot assure you that there will be sufficient funds available to make any distributions to us or that such distributions will meet our expectations from Funding I. The Investment Adviser has irrevocably directed that the management fee owed with respect to such services is to be paid to the Company so long as the Investment Adviser remains the collateral manager.

In November 2017, we issued $138.6 million of our 2023 Notes. The 2023 Notes were issued pursuant to a deed of trust between the Company and Mishmeret Trust Company, Ltd., as trustee, of which zero and $76.2 million was outstanding as of December 31, 2023 and September 30, 2023, respectively.

The 2023 Notes paid interest at a rate of 4.3% per year. Interest on the 2023 Notes was payable semi-annually in arrears on June 15 and December 15 of each year, commencing June 15, 2018. The principal on the 2023 Notes was payable in four annual installments as follows: 15% of the original principal amount on December 15, 2020, 15% of the original principal amount on December 15, 2021, 15% of the original principal amount on December 15, 2022 and 55% of the original principal amount on December 15, 2023. On December 15, 2023, the remaining outstanding 2023 Notes were repaid in full.

In March 2021 and in October 2021, we issued $100.0 million and $85.0 million, respectively, in aggregate principal amount of our 2026 Notes at a public offering price per note of 99.4% and 101.5%, respectively. Interest on the 2026 Notes is paid semi-annually on April 1 and October 1 of each year, at a rate of 4.25% per year, commencing October 1, 2021. The 2026 Notes mature on April 1, 2026 and may be redeemed in whole or in part at our option subject to a make-whole premium if redeemed more than three months prior to maturity. The 2026 Notes are our general, unsecured obligations and rank equal in right of payment with all of our existing and future senior

unsecured indebtedness. The 2026 Notes are effectively subordinated to all of our existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness and structurally subordinated to all existing and future indebtedness and other obligations of any of our subsidiaries, financing vehicles, or similar facilities. We do not intend to list the 2026 Notes on any securities exchange or automated dealer quotation system.

In September 2019, the Securitization Issuers completed the Debt Securitization. The 2031 Asset-Backed Debt is secured by the middle market loans, participation interests in middle market loans and other assets of the Securitization Issuer. The Debt Securitization was executed through (A) a private placement of: (i) $78.5 million Class A-1 Senior Secured Floating Rate Notes maturing 2031, which bear interest at the three-month SOFR plus 1.8%, (ii) $15.0 million Class A-2 Senior Secured Fixed Rate Notes due 2031, which bear interest at 3.7%, (iii) $14.0 million Class B-1 Senior Secured Floating Rate Notes due 2031, which bear interest at the three-month SOFR plus 2.9%, (iv) $16.0 million Class B-2 Senior Secured Fixed Rate Notes due 2031, which bear interest at 4.3%, (v) $19.0 million Class C‑1 Secured Deferrable Floating Rate Notes due 2031, which bear interest at the three-month SOFR plus 4.0%, (vi) $8.0 million Class C-2 Secured Deferrable Fixed Rate Notes due 2031, which bear interest at 5.4%, and (vii) $18.0 million Class D Secured Deferrable Floating Rate Notes due 2031, which bear interest at the three-month SOFR plus 4.8% and (B) the borrowing of $77.5 million Class A‑1 Senior Secured Floating Rate Loans due 2031, which bear interest at the three-month SOFR plus 1.8%, under a credit agreement by and among the Securitization Issuers, as borrowers, various financial institutions, as lenders, and U.S. Bank National Association, as collateral agent and as loan agent. The 2031 Asset-Backed Debt is scheduled to mature on October 15, 2031. As of both December 31, 2023 and September 30, 2023, the Company had $228.0 million of 2031 Asset-Backed Debt outstanding with a weighted average interest rate of 7.2% and 7.1%, respectively.

On the closing date of the Debt Securitization, in consideration of our transfer to the Securitization Issuer of the initial closing date loan portfolio, which included loans distributed to us by our wholly-owned subsidiary, the Securitization Issuer transferred to us 100% of the Preferred Shares of the Securitization Issuer, 100% of the Class D Secured Deferrable Floating Rate Notes issued by the Securitization Issuer, and a portion of the net cash proceeds received from the sale of the 2031 Asset-Backed Debt. The Preferred Shares of the Securitization Issuer do not bear interest and had a stated value of $55.4 million at the closing of the Debt Securitization.

The 2031 Asset-Backed Debt constitutes secured obligations of the Securitization Issuers, and the indenture governing the 2031 Asset-Backed Debt includes customary covenants and events of default. The 2031 Asset-Backed Debt has not been, and will not be, registered under the Securities Act or any state securities or “blue sky” laws and may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from registration.

Our Investment Adviser serves as collateral manager to the Securitization Issuer pursuant to a collateral management agreement between our Investment Adviser and the Securitization Issuer, or the Collateral Management Agreement. For so long as our Investment Adviser serves as collateral manager, it will elect to irrevocably waive any collateral management fee to which it may be entitled under the Collateral Management Agreement.

On March 27, 2023 we entered into equity distribution agreements with JMP Securities LLC, Raymond James & Associates, Inc. and Truist Securities, Inc. (together, the "Equity Distribution Agreements"), as sales agents (each a “Sales Agent” and together, the “Sales Agents”) in connection with the sale of shares of our common stock, with an aggregate offering price of up to $100 million under an at-the-market offering (“ATM Program”). On August 11, 2023, we amended the Equity Distribution Agreements with each of the Sales Agents (together, the "Amended and Restated Equity Distribution Agreements") to increase the aggregate offering price to up to $250 million. The Amended and Restated Equity Distribution Agreements provide that we may offer and sell shares of our common stock from time to time through a sales agent in amounts and at times to be determined by us. Actual sales will depend on a variety of factors to be determined by us from time to time, including, market conditions and the trading price of our common stock. The Investment Adviser may, from time to time, in its sole discretion, pay some or all of the commissions payable under the equity distribution agreements or make additional supplemental payments to ensure that the sales price per share of our common stock in connection with all of the offerings made hereunder will not be less than our current NAV per share. Any such payments made by the Investment Adviser will not be subject to reimbursement by us.

During the three months ended December 31, 2023, we did not issue any shares of common stock through the ATM Program.

We may raise equity or debt capital through both registered offerings off our shelf registration statement and private offerings of securities, securitizing a portion of our investments among other considerations or mergers and acquisitions. Furthermore, the Credit Facility availability depends on various covenants and restrictions as discussed in the preceding paragraphs. The primary use of existing funds and any funds raised in the future is expected to be for repayment of indebtedness, investments in portfolio companies, cash distributions to our stockholders or for other general corporate purposes.

We have entered into certain contracts under which we have material future commitments. Under our Investment Management Agreement, which was most recently reapproved by our board of directors, including a majority of our directors who are not interested persons of us or the Investment Adviser, in February 2024, PennantPark Investment Advisers serves as our investment adviser. Payments under our Investment Management Agreement in each reporting period are equal to (1) a management fee equal to a percentage of the value of our average adjusted gross assets and (2) an incentive fee based on our performance.

Under our Administration Agreement, which was most recently reapproved by our board of directors, including a majority of our directors who are not interested persons of us, in February 2024, the Administrator furnishes us with office facilities and administrative services necessary to conduct our day-to-day operations. The Administration Agreement was amended on July 1, 2022. If requested to provide significant managerial assistance to our portfolio companies, we or the Administrator will be paid an additional amount based on the services provided. Payment under our Administration Agreement is based upon our allocable portion of the Administrator’s overhead in performing its obligations under our Administration Agreement, including rent and our allocable portion of the costs of our Chief Financial Officer, Chief Compliance Officer, Corporate Counsel and their respective staffs.

If any of our contractual obligations discussed above are terminated, our costs under new agreements that we enter into may increase. In addition, we will likely incur significant time and expense in locating alternative parties to provide the services we expect to receive under our Investment Management Agreement and our Administration Agreement. Any new investment management agreement would also be subject to approval by our stockholders.

As of December 31, 2023 and September 30, 2023, we had cash and cash equivalents of $75.8 million and $100.6 million, respectively, available for investing and general corporate purposes. We believe our liquidity and capital resources are sufficient to take advantage of market opportunities.

For the three months ended December 31, 2023, our operating activities used cash of $181.9 million and our financing activities provided cash of $157.2 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily due to borrowings under our Credit Facility partially offset by the repayment of the 2023 Notes.

For the three months ended December 31, 2022, our operating activities provided cash of $6.3 million and our financing activities used cash of $2.7 million. Our operating activities provided cash primarily realized from our investment activities and our financing activities used cash primarily due to borrowings under our Credit Facility and principal repayment of our 2023 Notes.

PennantPark Senior Secured Loan Fund I LLC

Below is a summary of PSSL’s portfolio at fair value:


($ in thousands)	December 31, 2023			September 30, 2023
Total investments	$	836,857		$	785,859
Weighted average cost yield on income producing investments		12.1	%		12.1	%
Number of portfolio companies in PSSL		106			105
Largest portfolio company investment	$	21,114		$	18,463
Total of five largest portfolio company investments	$	91,715		$	83,365

Below is a listing of PSSL’s individual investments as of December 31, 2023 (Par and $ in thousands):


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)	Par		Cost		Fair Value (2)
First Lien Secured Debt - 1,398.7%
A1 Garage Merger Sub, LLC	12/22/2028	Commercial Services & Supplies		11.96	%	SOFR+660		2,932	$	2,881	$	2,918
ACP Avenu Buyer, LLC	10/1/2029	Business Services		11.75	%	SOFR+626		10,000		9,827		9,750
ACP Falcon Buyer, Inc.	8/1/2029	Business Services		11.85	%	SOFR+650		18,904		18,539		18,696
Ad.net Acquisition, LLC	5/7/2026	Media		11.61	%	SOFR+626		8,775		8,708		8,731
Alpine Acquisition Corp II	11/30/2026	Containers and Packaging		11.44	%	SOFR+600		12,820		12,519		12,307
Anteriad, LLC (f/k/a MeritDirect, LLC)	5/23/2024	Media: Advertising, Printing & Publishing		11.00	%	SOFR+565		4,930		4,912		4,881
Anteriad, LLC (f/k/a MeritDirect, LLC) - Incremental Term Loan	5/23/2024	Media: Advertising, Printing & Publishing		12.00	%	SOFR+665		4,813		4,778		4,788
Any Hour Services	7/21/2027	Professional Services		11.23	%	SOFR+585		7,491		7,338		7,416
Applied Technical Services, LLC	12/29/2026	Commercial Services & Supplies		11.25	%	SOFR+615		9,748		9,652		9,553
Arcfield Acquisition Corp.	8/3/2029	Aerospace and Defense		11.64	%	SOFR+625		11,200		11,048		11,088
Beta Plus Technologies, Inc.	7/1/2029	Business Services		11.10	%	SOFR+575		4,938		4,854		4,740
BioDerm, Inc.	1/31/2028	Healthcare and Pharmaceuticals		11.84	%	SOFR+650		8,955		8,854		8,865
Blackhawk Industrial Distribution, Inc.	9/17/2026	Distributors		11.75	%	SOFR+625		15,092		14,892		14,904
BlueHalo Financing Holdings, LLC	10/31/2025	Aerospace and Defense		12.01	%	SOFR+665		5,588		5,552		5,476
Broder Bros., Co.	12/4/2025	Consumer Products		11.65	%	SOFR+626		2,334		2,334		2,334
Burgess Point Purchaser Corporation	9/26/2029	Automotive		10.71	%	SOFR+525		446		418		419
By Light Professional IT Services, LLC	5/16/2025	High Tech Industries		12.40	%	SOFR+688		13,538		13,500		13,267
Cartessa Aesthetics, LLC	6/14/2028	Distributors		11.10	%	SOFR+575		9,612		9,490		9,612
CF512, Inc.	8/20/2026	Media		11.57	%	SOFR+619		6,803		6,713		6,667
CHA Holdings, Inc.	4/10/2025	Construction and Engineering		9.97	%	SOFR+461		5,484		5,448		5,484
Challenger Performance Optimization, Inc.	8/31/2024	Business Services		12.18	%	SOFR+775		9,232		9,208		8,909
			(PIK 1.00%)
Confluent Health, LLC	10/28/2028	Healthcare and Pharmaceuticals		9.47	%	SOFR+400		6,761		6,529		6,626
Connatix Buyer, Inc.	7/13/2027	Media		11.14	%	SOFR+576		3,805		3,756		3,634
Crane 1 Services, Inc.	8/16/2027	Commercial Services & Supplies		10.36	%	SOFR+501		2,084		2,063		2,073
Dr. Squatch, LLC	8/31/2027	Personal Products		11.20	%	SOFR+585		14,675		14,484		14,675
DRI Holding Inc.	12/21/2028	Media		10.71	%	SOFR+525		2,620		2,419		2,385
DRS Holdings III, Inc.	11/3/2025	Consumer Goods: Durable		11.75	%	SOFR+640		14,189		14,144		14,033
Duraco Specialty Tapes LLC	6/30/2024	Containers and Packaging		11.96	%	SOFR+650		10,876		10,833		10,702
ECL Entertainment, LLC	8/31/2030	Hotel, Gaming and Leisure		10.14	%	SOFR+475		5,000		4,913		5,004
EDS Buyer, LLC	1/10/2029	Electronic Equipment, Instruments, and Components		11.60	%	SOFR+625		8,933		8,817		8,843
Exigo Intermediate II, LLC	3/15/2027	Software		11.46	%	SOFR+610		12,643		12,484		12,453
ETE Intermediate II, LLC	5/29/2029	Diversified Consumer Services		11.89	%	SOFR+650		12,373		12,132		12,373
Fairbanks Morse Defense	6/17/2028	Aerospace and Defense		10.36	%	SOFR+475		10,169		10,119		10,150
Global Holdings InterCo LLC	3/16/2026	Diversified Financial Services		11.46	%	SOFR+610		3,726		3,715		3,540
Graffiti Buyer, Inc.	8/10/2027	Trading Companies & Distributors		10.95	%	SOFR+560		2,339		2,314		2,316
Hancock Roofing and Construction L.L.C.	12/31/2026	Insurance		10.95	%	SOFR+560		2,250		2,219		2,160
Holdco Sands Intermediate, LLC	11/23/2028	Aerospace and Defense		11.57	%	SOFR+635		4,900		4,830		4,851
HW Holdco, LLC	12/10/2024	Media		11.80	%	SOFR+640		3,014		2,993		2,968
Imagine Acquisitionco, LLC	11/15/2027	Software		10.74	%	SOFR+550		9,225		9,064		9,086
Inception Fertility Ventures, LLC	12/31/2024	Healthcare Providers and Services		12.64	%	SOFR+725		16,411		16,254		16,411
Infinity Home Services Holdco, Inc.	12/28/2028	Commercial Services & Supplies		12.20	%	SOFR+685		6,075		5,967		6,075
Integrative Nutrition, LLC	1/31/2025	Diversified Consumer Services		12.50	%	SOFR+715		11,130		11,113		10,351
			(PIK 2.25%)
Integrity Marketing Acquisition, LLC	8/27/2026	Insurance		11.54	%	SOFR+615		5,895		5,847		5,836
Inventus Power, Inc.	6/30/2025	Consumer Goods: Durable		12.97	%	SOFR+761		8,226		8,094		8,061
ITI Holdings, Inc.	3/3/2028	IT Services		10.96	%	SOFR+560		3,940		3,888		3,822
K2 Pure Solutions NoCal, L.P.	1/31/2024	Chemicals, Plastics and Rubber		15.46	%	SOFR+1000		14,602		14,599		14,602
Kinetic Purchaser, LLC	11/10/2027	Personal Products		11.50	%	SOFR+615		16,620		16,324		16,537
Lash OpCo, LLC	2/18/2027	Personal Products		12.48	%	SOFR+700		14,174		13,968		14,103
LAV Gear Holdings, Inc.	10/31/2025	Capital Equipment		11.82	%	SOFR+640		15,006		14,973		14,676
Lightspeed Buyer Inc.	2/3/2026	Healthcare Providers and Services		10.71	%	SOFR+535		12,024		11,896		11,964
LJ Avalon Holdings, LLC	1/31/2030	Environmental Industries		11.86	%	SOFR+640		2,579		2,533		2,527
Loving Tan Intermediate II, Inc.	5/31/2028	Consumer Products		12.35	%	SOFR+700		7,463		7,326		7,388
Lucky Bucks, LLC - First-Out Term Loan	10/2/2028	Hotel, Gaming and Leisure		13.03	%	SOFR+765		261		261		261
Lucky Bucks, LLC - Last-Out Term Loan	10/2/2029	Hotel, Gaming and Leisure		13.03	%	SOFR+765		522		522		522
MAG DS Corp	4/1/2027	Aerospace and Defense		10.95	%	SOFR+550		2,091		2,007		1,997
Magenta Buyer, LLC	7/31/2028	Software		10.64	%	SOFR+500		2,998		2,844		2,106
Marketplace Events, LLC - Super Priority First Lien Term Loan	9/30/2025	Media: Diversified and Production		10.94	%	SOFR+525		647		647		647
Marketplace Events, LLC - Super Priority First Lien Unfunded Term Loan (3)	9/30/2025	Media: Diversified and Production						589		-		-
Marketplace Events, LLC	9/30/2026	Media: Diversified and Production		10.94	%	SOFR+525		4,837		3,852		4,837
Mars Acquisition Holdings Corp.	5/14/2026	Media		11.01	%	SOFR+565		11,558		11,460		11,558
MBS Holdings, Inc.	4/16/2027	Internet Software and Services		11.21	%	SOFR+585		8,395		8,290		8,282
MDI Buyer, Inc.	7/25/2028	Chemicals, Plastics and Rubber		11.63	%	SOFR+625		6,364		6,260		6,212
Meadowlark Acquirer, LLC	12/10/2027	Professional Services		11.00	%	SOFR+565		2,366		2,332		2,295


Issuer Name	Maturity		Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Medina Health, LLC	10/20/2028		Healthcare and Pharmaceuticals		11.60	%	SOFR+625			19,344	$	19,018	$	18,957
Mission Critical Electronics, Inc.	3/28/2024		Capital Equipment		11.29	%	SOFR+590			5,769		5,764		5,769
Municipal Emergency Services, Inc.	9/28/2027		Distributors		10.50	%	SOFR+515			3,421		3,374		3,418
NBH Group LLC	8/19/2026		Healthcare, Education & Childcare		11.19	%	SOFR+525			10,684		10,553		10,043
Neptune Flood Incorporated	5/9/2029		Insurance		11.72	%	SOFR+650			4,932		4,865		4,932
New Milani Group LLC	6/6/2024		Consumer Goods: Non-Durable		10.96	%	SOFR+550			14,175		14,161		14,175
NORA Acquisition, LLC	8/31/2029		Healthcare Providers and Services		11.70	%	SOFR+635			21,435		21,043		21,114
One Stop Mailing, LLC	5/7/2027		Air Freight and Logistics		11.72	%	SOFR+636			15,807		15,559		15,807
ORL Acquisitions, Inc.	9/3/2027		Consumer Finance		12.75	%	SOFR+740			2,217		2,198		1,884
Output Services Group, Inc - First-Out Term Loan	11/30/2028		Business Services		13.82	%	SOFR+843			821		821		821
Output Services Group, Inc - Last-Out Term Loan	5/30/2028		Business Services		12.07	%	SOFR+668			1,667		1,667		1,667
Owl Acquisition, LLC	2/4/2028		Professional Services		10.70	%	SOFR+550			3,893		3,835		3,834
Ox Two, LLC	5/18/2026		Construction and Building		12.86	%	SOFR+751			4,345		4,310		4,291
Pacific Purchaser, LLC	9/30/2028		Business Services		11.43	%	SOFR+625			12,028		11,808		11,848
Pequod Merger Sub, Inc. - Term Loan (f/k/a Simplicity Group)	12/2/2026		Diversified Financial Services		11.75	%	SOFR+640			11,474		11,281		11,244
PH Beauty Holdings III, Inc.	9/29/2025		Wholesale		10.65	%	SOFR+500			9,468		9,292		8,884
PL Acquisitionco, LLC	11/9/2027		Textiles, Apparel and Luxury Goods		12.46	%	SOFR+710			7,633		7,539		6,755
				(PIK 4.00%)
PlayPower, Inc.	5/8/2026		Consumer Goods: Durable		11.06	%	SOFR+565			2,551		2,497		2,474
Pragmatic Institute, LLC	7/6/2028		Education		11.14	%	SOFR+575			11,109		10,977		10,387
Quantic Electronics, LLC	11/19/2026		Aerospace and Defense		11.70	%	SOFR+635			2,796		2,774		2,740
Rancho Health MSO, Inc.	12/18/2025		Healthcare Providers and Services		11.24	%	SOFR+585			1,026		1,026		1,026
Reception Purchaser, LLC	2/28/2028		Air Freight and Logistics		11.50	%	SOFR+615			4,925		4,868		4,777
Recteq, LLC	1/29/2026		Leisure Products		12.50	%	SOFR+715			4,863		4,819		4,692
Research Now Group, LLC and Dynata, LLC	12/20/2024		Diversified Consumer Services		11.14	%	SOFR+576			12,399		12,314		10,973
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.)	6/15/2029		High Tech Industries		11.43	%	SOFR+625			3,739		3,669		3,683
Sales Benchmark Index LLC	1/3/2025		Professional Services		11.55	%	SOFR+620			9,268		9,233		9,222
Sargent & Greenleaf Inc.	12/20/2024		Wholesale		12.96	%	SOFR+760			5,181		5,165		5,155
				(PIK 1.00%)
Schlesinger Global, Inc.	7/14/2025		Business Services		12.53	%	SOFR+715			11,791		11,780		11,407
				(PIK 0.50%)
Seaway Buyer, LLC	6/13/2029		Chemicals, Plastics and Rubber		11.50	%	SOFR+615			4,938		4,874		4,765
Sigma Defense Systems, LLC	12/18/2027		Aerospace and Defense		12.50	%	SOFR+715			12,141		11,973		12,020
Skopima Consilio Parent, LLC	5/17/2028		Business Services		9.97	%	SOFR+450			1,300		1,275		1,290
Smile Brands Inc.	10/14/2025		Healthcare and Pharmaceuticals		9.98	%	SOFR+450			11,766		11,733		10,299
Solutionreach, Inc.	7/17/2025		Healthcare and Pharmaceuticals		12.53	%	SOFR+700			4,582		4,554		4,568
Spendmend Holdings LLC	3/1/2028		Healthcare Technology		11.00	%	SOFR+565			4,102		4,040		4,057
STV Group Incorporated	12/11/2026		Construction and Building		10.71	%	SOFR+535			9,075		9,028		8,985
Summit Behavioral Healthcare, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.40	%	SOFR+501			1,782		1,695		1,777
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)	8/16/2027		Aerospace and Defense		11.33	%	SOFR+615			14,700		14,518		14,612
Team Services Group, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.75	%	SOFR+500			346		333		342
Teneo Holdings LLC	7/18/2025		Business Services		10.71	%	SOFR+535			2,256		2,255		2,251
The Bluebird Group LLC	7/27/2026		Professional Services		12.00	%	SOFR+665			8,569		8,455		8,475
The Vertex Companies, LLC	8/31/2027		Construction and Engineering		11.46	%	SOFR+610			7,696		7,577		7,684
TPC Canada Parent, Inc. and TPC US Parent, LLC	11/24/2025		Consumer Goods: Non-Durable		11.04	%	SOFR+565			8,640		8,553		8,554
TWS Acquisition Corporation	6/16/2025		Diversified Consumer Services		11.78	%	SOFR+640			3,740		3,738		3,740
Tyto Athene, LLC	4/1/2028		IT Services		11.04	%	SOFR+565			14,670		14,569		13,555
Urology Management Holdings, Inc.	6/15/2026		Healthcare and Pharmaceuticals		11.93	%	SOFR+665			6,875		6,766		6,732
Walker Edison Furniture Company LLC	3/1/2029		Wholesale		12.21	%	SOFR+685			4,028		4,028		3,947
Walker Edison Furniture Company LLC - Junior Revolving Credit Facility	3/1/2029		Wholesale		11.71	%	SOFR+635			1,667		1,667		1,667
Walker Edison Furniture Company LLC - DDTL - Unfunded (3)	3/1/2029		Wholesale							1,042		-		(21	)
Wildcat Buyerco, Inc.	2/27/2027		Electronic Equipment, Instruments, and Components		11.11	%	SOFR+575			16,138		15,993		15,896
Zips Car Wash, LLC	3/1/2024		Automobiles		12.70	%	SOFR+735			16,732		16,698		16,355

Total First Lien Secured Debt												841,081		833,276
Equity Securities - 3.9%
Lucky Bucks, LLC		—	Hotel, Gaming and Leisure		—			—		74		2,062		2,062
New MPE Holdings, LLC		—	Media: Diversified and Production		—			—		-		-		507
Output Services Group, Inc		—	Business Services		—			—		126		1,012		1,012
Walker Edison Furniture - Common Equity		—	Wholesale		—			—		36		3,393		-
Total Equity Securities												6,467		3,581
Total Investments - 1,404.7%												847,548		836,857
Cash and Cash Equivalents - 61.0%
BlackRock Federal FD Institutional 30												36,339		36,339
Total Cash and Cash Equivalents												36,339		36,339
Total Investments and Cash Equivalents —1,465.7%											$	883,887	$	873,196
Liabilities in Excess of Other Assets — (1,365.7)%														(813,620	)
Members' Equity—100.0%													$	59,576

(1)

Represents floating rate instruments that accrue interest at a predetermined spread relative to an index, typically the applicable Secured Overnight Financing Rate or "SOFR", or Prime rate or “P”. The spread may change based on the type of rate used. The terms in the Consolidated Schedule of Investments disclose the actual interest rate in effect as of the reporting period. All securities are subject to a SOFR or Prime rate floor where a spread is provided, unless noted. The spread provided includes PIK interest and other fee rates, if any.

(2)

Below is a listing of PSSL’s individual investments as of September 30, 2023 ($ in thousands):


Issuer Name	Maturity	Industry	Current Coupon			Basis Point Spread Above Index (1)	Par		Cost		Fair Value (2)
First Lien Secured Debt - 1,347.5%
A1 Garage Merger Sub, LLC	12/22/2028	Commercial Services & Supplies		11.84	%	SOFR+660		2,940	$	2,886	$	2,925
Ad.net Acquisition, LLC	5/7/2026	Media		11.65	%	SOFR+626		8,798		8,723		8,754
Alpine Acquisition Corp II	11/30/2026	Containers and Packaging		11.24	%	SOFR+600		12,852		12,535		12,338
Anteriad, LLC (f/k/a MeritDirect, LLC)	5/23/2024	Media: Advertising, Printing & Publishing		11.04	%	SOFR+550		5,001		4,971		4,913
Anteriad Holdings Inc (fka MeritDirect) March 2023	5/23/2024	Media: Advertising, Printing & Publishing		12.04	%	SOFR+650		4,875		4,817		4,814
Any Hour Services	7/21/2027	Professional Services		11.59	%	SOFR+585		7,510		7,348		7,360
Apex Service Partners, LLC	7/31/2025	Diversified Consumer Services		10.52	%	SOFR+525		1,002		1,002		1,000
Apex Service Partners, LLC Term Loan B	7/31/2025	Diversified Consumer Services		11.04	%	SOFR+550		2,187		2,187		2,181
Apex Service Partners, LLC Term Loan C	7/31/2025	Diversified Consumer Services		10.69	%	SOFR+525		11,013		10,972		10,985
Applied Technical Services, LLC	12/29/2026	Commercial Services & Supplies		11.54	%	SOFR+615		9,579		9,475		9,387
Applied Technical Services, LLC - DDTL Unfunded (3)	12/29/2026	Commercial Services & Supplies						194		-		(2	)
Arcfield Acquisition Corp.	8/3/2029	Aerospace and Defense		11.62	%	SOFR+625		9,218		9,093		9,126
Beta Plus Technologies, Inc.	7/1/2029	Business Services		11.14	%	SOFR+575		4,950		4,863		4,604
BioDerm, Inc.	1/31/2028	Healthcare and Pharmaceuticals		11.83	%	SOFR+650		8,978		8,874		8,933
Blackhawk Industrial Distribution, Inc.	9/17/2026	Distributors		11.79	%	SOFR+640		15,132		14,928		14,905
Broder Bros., Co.	12/4/2025	Consumer Products		11.50	%	SOFR+626		2,349		2,349		2,349
By Light Professional IT Services, LLC	5/16/2025	High Tech Industries		12.43	%	SOFR+688		13,821		13,778		13,579
Cadence Aerospace, LLC	11/14/2023	Aerospace and Defense		12.07	%	SOFR+665		4,011		4,010		4,011
			(PIK 2.00%)
Cartessa Aesthetics, LLC	6/14/2028	Distributors		11.39	%	SOFR+600		9,636		9,509		9,636
CHA Holdings, Inc.	4/10/2025	Construction and Engineering		10.15	%	SOFR+476		5,499		5,455		5,499
Challenger Performance Optimization, Inc.	8/31/2024	Business Services		12.18	%	SOFR+675		9,232		9,201		8,955
			(PIK 1.00%)
Confluent Health, LLC	10/28/2028	Healthcare and Pharmaceuticals		9.32	%	SOFR+400		6,797		6,559		6,445
Connatix Buyer, Inc.	7/13/2027	Media		11.16	%	SOFR+576		3,815		3,762		3,681
Crane 1 Services, Inc.	8/16/2027	Commercial Services & Supplies		10.90	%	SOFR+551		2,089		2,067		2,079
Dr. Squatch, LLC	8/31/2027	Personal Products		11.24	%	SOFR+585		14,712		14,511		14,712
DRI Holding Inc.	12/21/2028	Media		10.67	%	SOFR+525		2,627		2,418		2,394
DRS Holdings III, Inc.	11/3/2025	Consumer Goods: Durable		11.79	%	SOFR+640		14,429		14,376		14,256
Duraco Specialty Tapes LLC	6/30/2024	Containers and Packaging		11.89	%	SOFR+650		10,904		10,838		10,740
ECL Entertainment, LLC	8/31/2030	Hotel, Gaming and Leisure		10.07	%	SOFR+475		5,000		4,900		4,985
EDS Buyer, LLC	1/10/2029	Electronic Equipment, Instruments, and Components		11.64	%	SOFR+625		8,955		8,833		8,821
Electro Rent Corporation	1/17/2024	Electronic Equipment, Instruments, and Components		11.00	%	SOFR+550		2,219		2,200		2,171
Exigo Intermediate II, LLC	3/15/2027	Software		11.17	%	SOFR+585		12,675		12,505		12,422
ETE Intermediate II, LLC	5/29/2029	Diversified Consumer Services		11.89	%	SOFR+650		12,404		12,154		12,193
Fairbanks Morse Defense	6/17/2028	Aerospace and Defense		10.40	%	SOFR+475		10,195		10,143		10,114
Global Holdings InterCo LLC	3/16/2026	Diversified Financial Services		11.96	%	SOFR+660		3,736		3,724		3,549
Graffiti Buyer, Inc.	8/10/2027	Trading Companies & Distributors		10.99	%	SOFR+575		2,345		2,316		2,322
Hancock Roofing and Construction L.L.C.	12/31/2026	Insurance		10.92	%	SOFR+560		2,250		2,217		2,194
Holdco Sands Intermediate, LLC	11/23/2028	Aerospace and Defense		11.32	%	SOFR+585		4,913		4,838		4,913
HW Holdco, LLC	12/10/2024	Media		11.75	%	SOFR+640		3,014		2,988		2,968
Imagine Acquisitionco, LLC	11/15/2027	Software		10.72	%	SOFR+535		9,248		9,075		9,110
Inception Fertility Ventures, LLC	12/31/2024	Healthcare Providers and Services		12.51	%	SOFR+715		16,453		16,257		16,453
Infinity Home Services Holdco, Inc.	12/28/2028	Commercial Services & Supplies		12.24	%	SOFR+685		6,090		5,979		6,090
Integrated Data Services	8/1/2029	Business Services		11.87	%	SOFR+650		18,904		18,532		18,463
Integrative Nutrition, LLC	1/31/2025	Diversified Consumer Services		12.54	%	SOFR+700		11,105		11,083		10,439
			(PIK 2.25%)
Integrity Marketing Acquisition, LLC	8/27/2026	Insurance		11.57	%	SOFR+575		5,906		5,851		5,847
ITI Holdings, Inc.	3/3/2028	IT Services		11.06	%	SOFR+560		3,940		3,886		3,861
K2 Pure Solutions NoCal, L.P.	12/20/2023	Chemicals, Plastics and Rubber		13.42	%	SOFR+810		15,509		15,487		15,509
Kinetic Purchaser, LLC	11/10/2027	Personal Products		11.54	%	SOFR+615		16,662		16,346		16,412
Lash OpCo, LLC	2/18/2027	Personal Products		12.13	%	SOFR+675		14,210		13,989		14,068
LAV Gear Holdings, Inc.	10/31/2024	Capital Equipment		11.74	%	SOFR+643		15,042		14,997		14,862
Lightspeed Buyer Inc.	2/3/2026	Healthcare Providers and Services		10.70	%	SOFR+535		12,056		11,911		11,935
LJ Avalon Holdings, LLC	1/31/2030	Environmental Industries		11.77	%	SOFR+640		2,585		2,537		2,534
Loving Tan Intermediate II, Inc.	5/26/2028	Consumer Products		12.39	%	SOFR+700		7,481		7,337		7,369
Lucky Bucks, LLC (4)	7/20/2027	Hotel, Gaming and Leisure		0.00	%			4,489		4,207		1,182
Lucky Bucks. LLC - OpCo DIP Loans	9/30/2025	Hotel, Gaming and Leisure		15.33	%	SOFR+1000		160		158		160
MAG DS Corp	4/1/2027	Aerospace and Defense		10.99	%	SOFR+550		2,097		2,007		1,986
Magenta Buyer, LLC	7/31/2028	Software		10.63	%	SOFR+500		3,006		2,845		2,228
Marketplace Events, LLC - Super Priority First Lien Term Loan	9/30/2025	Media: Diversified and Production		10.94	%	SOFR+525		647		647		647
Marketplace Events, LLC - Super Priority First Lien Unfunded Term Loan (3)	9/30/2025	Media: Diversified and Production						589		-		-
Marketplace Events, LLC	9/30/2026	Media: Diversified and Production		10.94	%	SOFR+525		4,837		3,782		4,837
Mars Acquisition Holdings Corp.	5/14/2026	Media		11.04	%	SOFR+565		11,588		11,476		11,472
MBS Holdings, Inc.	4/16/2027	Internet Software and Services		11.17	%	SOFR+585		7,859		7,758		7,749
MDI Buyer, Inc.	7/25/2028	Chemicals, Plastics and Rubber		11.32	%	SOFR+600		6,380		6,271		6,244
Meadowlark Acquirer, LLC	12/10/2027	Professional Services		11.04	%	SOFR+565		2,372		2,336		2,312


Issuer Name	Maturity		Industry	Current Coupon			Basis Point Spread Above Index (1)		Par / Shares		Cost		Fair Value (2)
Mission Critical Electronics, Inc.	3/28/2024		Capital Equipment		11.29	%	SOFR+515			5,769	$	5,763	$	5,740
Municipal Emergency Services, Inc.	9/28/2027		Distributors		11.04	%	SOFR+565			3,430		3,380		3,355
NBH Group LLC	8/19/2026		Healthcare, Education & Childcare		10.93	%	SOFR+525			10,711		10,572		10,497
New Milani Group LLC	6/6/2024		Consumer Goods: Non-Durable		10.92	%	SOFR+550			14,213		14,194		14,213
One Stop Mailing, LLC	5/7/2027		Air Freight and Logistics		11.68	%	SOFR+636			15,849		15,588		15,849
ORL Acquisitions, Inc.	9/3/2027		Consumer Finance		12.84	%	SOFR+725			2,223		2,202		2,023
Output Services Group, Inc. (4)	6/27/2026		Business Services		0.00	%		—		7,759		7,689		1,513
Owl Acquisition, LLC	2/4/2028		Professional Services		10.80	%	SOFR+575			3,893		3,832		3,834
Ox Two, LLC	5/18/2026		Construction and Building		12.90	%	SOFR+751			4,345		4,306		4,269
Peaquod Merger Sub, Inc.	12/2/2026		Diversified Financial Services		11.79	%	SOFR+640			11,474		11,267		11,244
PH Beauty Holdings III, Inc.	9/29/2025		Wholesale		10.68	%	SOFR+500			9,493		9,282		7,974
PL Acquisitionco, LLC	11/9/2027		Textiles, Apparel and Luxury Goods		12.42	%	SOFR+710			7,565		7,467		6,809
				(PIK 4.00%)
PlayPower, Inc.	5/8/2026		Consumer Goods: Durable		10.57	%	SOFR+565			2,551		2,491		2,436
Pragmatic Institute, LLC	7/6/2028		Education		11.17	%	SOFR+575			11,138		10,999		10,636
Quantic Electronics, LLC	11/19/2026		Aerospace and Defense		11.74	%	SOFR+635			2,803		2,776		2,761
Rancho Health MSO, Inc.	12/18/2025		Healthcare Providers and Services		11.22	%	SOFR+585			1,029		1,029		1,029
Reception Purchaser, LLC	2/28/2028		Air Freight and Logistics		11.54	%	SOFR+600			4,938		4,876		4,740
Recteq, LLC	1/29/2026		Leisure Products		12.54	%	SOFR+700			4,875		4,825		4,729
Research Now Group, LLC and Dynata, LLC	12/20/2024		Diversified Consumer Services		11.13	%	SOFR+576			12,432		12,322		10,878
Rural Sourcing Holdings, Inc. (HPA SPQ Merger Sub, Inc.)	6/15/2029		High Tech Industries		11.52	%	SOFR+625			3,749		3,676		3,692
Sales Benchmark Index LLC	1/3/2025		Professional Services		11.59	%	SOFR+620			9,522		9,474		9,475
Sargent & Greenleaf Inc.	12/20/2024		Wholesale		12.92	%	SOFR+760			5,167		5,148		5,116
				(PIK 1.00%)
Schlesinger Global, Inc.	7/14/2025		Business Services		12.52	%	SOFR+715			11,791		11,777		11,407
				(PIK 0.50%)
Seaway Buyer, LLC	6/13/2029		Chemicals, Plastics and Rubber		11.54	%	SOFR+615			4,950		4,884		4,802
Sigma Defense Systems, LLC	12/18/2025		Aerospace and Defense		14.04	%	SOFR+865			13,787		13,579		13,580
Skopima Consilio Parent, LLC	5/17/2028		Business Services		9.93	%	SOFR+450			1,300		1,274		1,272
Smile Brands Inc.	10/14/2025		Healthcare and Pharmaceuticals		9.70	%	SOFR+450			11,796		11,739		10,598
Solutionreach, Inc.	7/17/2025		Healthcare and Pharmaceuticals		12.37	%	SOFR+700			4,582		4,577		4,563
Spendmend Holdings LLC	3/1/2028		Healthcare Technology		11.04	%	SOFR+565			4,112		4,047		4,022
STV Group Incorporated	12/11/2026		Construction and Building		10.67	%	SOFR+535			9,075		9,025		8,894
Summit Behavioral Healthcare, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.43	%	SOFR+475			1,786		1,696		1,779
System Planning and Analysis, Inc. (f/k/a Management Consulting & Research, LLC)	8/16/2027		Aerospace and Defense		11.49	%	SOFR+600			14,738		14,540		14,575
Team Services Group, LLC	11/24/2028		Healthcare and Pharmaceuticals		10.75	%	SOFR+500			346		333		339
Teneo Holdings LLC	7/18/2025		Business Services		10.67	%	SOFR+535			2,262		2,261		2,259
The Aegis Technologies Group, LLC	10/31/2025		Aerospace and Defense		12.04	%	SOFR+665			5,602		5,560		5,518
The Bluebird Group LLC	7/27/2026		Professional Services		12.79	%	SOFR+700			5,403		5,336		5,382
The Vertex Companies, LLC	8/31/2027		Construction and Engineering		11.72	%	SOFR+635			7,716		7,591		7,656
TPC Canada Parent, Inc. and TPC US Parent, LLC	11/24/2025		Consumer Goods: Non-Durable		10.95	%	SOFR+565			8,654		8,556		8,654
TWS Acquisition Corporation	6/16/2025		Diversified Consumer Services		11.80	%	SOFR+625			4,316		4,310		4,316
Tyto Athene, LLC	4/1/2028		IT Services		10.90	%	SOFR+550			14,670		14,565		13,379
Urology Management Holdings, Inc.	6/15/2026		Healthcare and Pharmaceuticals		11.79	%	SOFR+665			6,892		6,775		6,749
Walker Edison Furniture Company LLC	3/31/2027		Wholesale		12.18	%	SOFR+685			3,521		3,521		3,521
Walker Edison Furniture Company LLC - Junior Revolving Credit Facility	3/31/2027		Wholesale		11.68	%	SOFR+635			1,667		1,667		1,667
Walker Edison Furniture Company LLC - DDTL - Unfunded (3)	3/31/2027		Wholesale							333		-		-
Wildcat Buyerco, Inc.	2/27/2026		Electronic Equipment, Instruments, and Components		10.54	%	SOFR+515			10,565		10,491		10,460
Zips Car Wash, LLC	3/1/2024		Automobiles		12.67	%	SOFR+735			16,732		16,660		16,188

Total First Lien Secured Debt												801,215		783,598
Equity Securities - 3.9%
New MPE Holdings, LLC		—	Media: Diversified and Production		—			—		-		-		495
Walker Edison Furniture - Common Equity		—	Wholesale							36		3,393		1,766
Total Equity Securities												3,393		2,261
Total Investments - 1,351.4%												804,608		785,859
Cash and Cash Equivalents - 133.2%
BlackRock Federal FD Institutional 30												77,446		77,446
Total Cash and Cash Equivalents												77,446		77,446
Total Investments and Cash Equivalents —1,484.6%											$	882,054	$	863,305
Liabilities in Excess of Other Assets — (1,384.6)%														(805,155	)
Members' Equity—100.0%													$	58,150

(1)

Represents floating rate instruments that accrue interest at a predetermined spread relative to an index, typically the applicable Secured Overnight Financing Rate or "SOFR", or Prime rate or “P”. The spread may change based on the type of rate used. The terms in the Consolidated Schedule of Investments disclose the actual interest rate in effect as of the reporting period. All securities are subject to a SOFR or Prime rate floor where a spread is provided, unless noted. The spread provided includes PIK interest and other fee rates, if any.

(2)

Valued based on PSSL’s accounting policy.

(3)

Below are the consolidated statements of assets and liabilities for PSSL ($ in thousands):



		December 31, 2023
		(Unaudited)			September 30, 2023
Assets
Investments at fair value (amortized cost—$847,548 and $804,608, respectively)	$		836,857	$		785,859
Cash and cash equivalents (cost—$36,339 and $77,446, respectively)			36,339			77,446
Interest receivable			5,652			5,179
Due from affiliate			394			436
Prepaid expenses and other assets			151			490
Total assets			879,393			869,410
Liabilities
Credit facility payable			75,600			48,600
2032 Asset-backed debt, net (par—$246,000)			244,125			243,973
2035 Asset-backed debt, net (par—$246,000)			243,596			243,483
Notes payable to members			240,100			240,100
Interest payable on Credit facility and asset backed debt			9,105			14,291
Payable for investments purchased			—			13,466
Interest payable on notes to members			6,532			6,488
Accrued expenses			759			859
Total liabilities			819,817			811,260
Commitments and contingencies(1)
Members' equity			59,576			58,150
Total liabilities and members' equity	$		879,393	$		869,410

(1) As of December 31, 2023 and September 30, 2023, PSSL had unfunded commitments to fund investments of $1.6 million and $1.1 million, respectively.

Below are the consolidated statements of operations for PSSL ($ in thousands):



	Three months ended December 31,
	2023			2022
Investment income:
Interest	$	26,048		$	19,617
Other income		177			110
Total investment income		26,225			19,727
Expenses(1):
Interest and expense on credit facility and asset-backed debt		13,398			8,641
Interest expense on notes to members		8,220			6,810
Administration fees		558			508
General and administrative expenses		262			300
Total expenses		22,438			16,259
Net investment income		3,787			3,468
Realized and unrealized gain (loss) on investments:
Net realized gain (loss) on investments		(6,420	)		(70	)
Net change in unrealized appreciation (depreciation) on investments		8,059			(5,800	)
Net realized and unrealized gain (loss) on investments		1,639			(5,870	)
Net increase (decrease) in members' equity resulting from operations	$	5,426		$	(2,402	)

(1)

Currently, no management or incentive fees are payable by PSSL. If any fees were to be charged, they would be separately disclosed in the Statements of Operations.

Off-Balance Sheet Arrangements

We currently engage in no off-balance sheet arrangements other than our funding requirements for the unfunded investments described above.

Distributions

In order to be treated as a RIC for federal income tax purposes and to not be subject to corporate-level tax on undistributed income or gains, we are required, under Subchapter M of the Code, to annually distribute dividends for U.S. federal income tax purposes to our stockholders out of the assets legally available for distribution of an amount generally at least equal to 90% of our investment company taxable income, determined without regard to any deduction for dividends paid.

During the three months ended December 31, 2023 and 2022, we declared distributions of $0.3075 and $0.285 per share for total distributions of $18.1 million and $12.9 million, respectively. We monitor available net investment income to determine if a return of capital for tax purposes may occur for the fiscal year. To the extent our taxable earnings fall below the total amount of our distributions for any given fiscal year, stockholders will be notified of the portion of those distributions deemed to be a tax return of capital. Tax characteristics of all distributions will be reported to stockholders subject to information reporting on Form 1099-DIV after the end of each calendar year and in our periodic reports filed with the SEC.

We intend to continue to make monthly distributions to our stockholders. Our monthly distributions, if any, are determined by our board of directors quarterly.

We may not be able to achieve operating results that will allow us to make distributions at a specific level or to increase the amount of these distributions from time to time. In addition, we may be limited in our ability to make distributions due to the asset coverage ratio for borrowings applicable to us as a BDC under the 1940 Act and due

to provisions in future credit facilities. If we do not distribute at least a certain percentage of our income annually, we could suffer adverse tax consequences, including possible loss of our ability to be subject to tax as a RIC. We cannot assure stockholders that they will receive any distributions at a particular level.

Recent Accounting Pronouncements

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We are subject to financial market risks, including changes in interest rates. As of December 31, 2023, our debt portfolio consisted of approximately 100.0% variable-rate investments. The variable-rate loans are usually based on a SOFR (or an alternative risk-free floating interest rate index) rate and typically have durations of three months, after which they reset to current market interest rates. Variable-rate investments subject to a floor generally reset by reference to the current market index after one to nine months only if the index exceeds the floor. In regards to variable-rate instruments with a floor, we do not benefit from increases in interest rates until such rates exceed the floor and thereafter benefit from market rates above any such floor. In contrast, our cost of funds, to the extent it is not fixed, will fluctuate with changes in interest rates since it has no floor.

Assuming that the most recent Consolidated Statements of Assets and Liabilities was to remain constant, and no actions were taken to alter the existing interest rate sensitivity, the following table shows the annualized impact of hypothetical base rate changes in interest rates:


Change in Interest Rates	Change in Interest Income, Net of Interest Expense (in thousands)			Change in Interest Income, Net of Interest Expense Per Share
Down 1%	$	(6,603	)	$	(0.11	)
Up 1%		6,603			0.11
Up 2%		13,206			0.22
Up 3%		19,809			0.34
Up 4%		26,425			0.45

Although management believes that this measure is indicative of our sensitivity to interest rate changes, it does not adjust for potential changes in the credit market, credit quality, size and composition of the assets on the Consolidated Statements of Assets and Liabilities and other business developments that could affect net increase in net assets resulting from operations or net investment income. Accordingly, no assurances can be given that actual results would not differ materially from those shown above.

Because we borrow money to make investments, our net investment income is dependent upon the difference between the rate at which we borrow funds and the rate at which we invest these funds, as well as our level of leverage. As a result, there can be no assurance that a significant change in market interest rates will not have a material adverse effect on our net investment income or net assets.

We may hedge against interest rate and foreign currency fluctuations by using standard hedging instruments such as futures, options and forward contracts or our Credit Facility subject to the requirements of the 1940 Act and applicable commodities laws. While hedging activities may insulate us against adverse changes in interest rates and foreign currencies, they may also limit our ability to participate in benefits of lower interest rates or higher exchange rates with respect to our portfolio of investments with fixed interest rates or investments denominated in foreign currencies. During the periods covered by this Report, we did not engage in interest rate hedging activities or foreign currency derivatives hedging activities.

Item 4. Controls and Procedures

As of the quarter ended December 31, 2023, we, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act). As disclosed in our Annual Report on Form 10-K for the fiscal year ended September 30, 2023, a material weakness was previously identified in connection with our internal control over financial reporting relating to the review of quarterly cash and investment reconciliations. Additionally, a material weakness was identified in the operation of our internal controls over financial reporting relating to our review of interest income and non-accrual classification of investments. We have taken steps to remediate these material weaknesses, which steps have included (i) enhancing existing controls to ensure the appropriate review of the quarterly cash and investment reconciliation and that it is adequately documented so as to provide evidence that the controls are operating effectively, (ii) enhancing existing controls to ensure that our internal controls over financial reporting relating to our analysis of interest income and assessment of investments for classification as non-accrual investments are operating effectively and (iii) enhancing policies and procedures to demonstrate a commitment to improving our overall control environment.

Taking the above efforts into consideration, our management, including the Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures for the quarter ended December 31, 2023 were effective and provided reasonable assurance that information required to be disclosed in our periodic filings with the SEC is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. However, in evaluating the disclosure controls and procedures, management recognized that any controls and procedures, no matter how well designed and operated can provide only reasonable assurance of achieving the desired control objectives, and management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of such possible controls and procedures.

Other than disclosed in this Item 4, there have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None of us, our Investment Adviser or our Administrator, is currently subject to any material legal proceedings, nor, to our knowledge, is any material legal proceeding threatened against us, or against our Investment Adviser or Administrator. From time to time, we, our Investment Adviser or Administrator, may be a party to certain legal proceedings, including proceedings relating to the enforcement of our rights under contracts with our portfolio companies. While the outcome of these and any future legal proceedings cannot be predicted with certainty, we do not expect that these proceedings will have a material effect upon our financial condition or results of operations.

Item 1A. Risk Factors

In addition to the other information set forth in this Report, you should consider carefully the factors discussed below, as well as in Part I “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended September 30, 2023 filed on December 8, 2023, which could materially affect our business, financial condition and/or operating results. The risks described below, as well as in our Annual Report on Form 10-K are not the only risks facing PennantPark Floating Rate Capital Ltd. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition and/or operating results.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

10b5-1 Disclosure

None of the officers or directors of the Company have adopted or terminated any Rule 10b5-1 trading arrangements applicable to them (if any) or the Company.

Item 6. Exhibits

Unless specifically indicated otherwise, the following exhibits are incorporated by reference to exhibits previously filed with the SEC:


3.1	Articles of Amendment and Restatement of the Registrant (Incorporated by reference to Exhibit 99(A) to the Registrant's Pre-Effective Amendment No. 3 to the Registration Statement on Form N-2 (File No. 333-170243), filed on March 29, 2011).

3.2	Second Amended and Restated Bylaws of the Registrant (Incorporated by reference to Exhibit 3.2 to the Registrant's Quarterly Report on Form 10-Q (File No. 814-00891), filed on May 11, 2020).

4.1	Form of Share Certificate (Incorporated by reference to Exhibit 99(D) to the Registrant's Pre-Effective Amendment No. 5 to the Registration Statement on Form N-2 (File No. 333-170243), filed on April 5, 2011).

31.1*	Certification of Chief Executive Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.

31.2*	Certification of Chief Financial Officer pursuant to Rule 13a-14 of the Securities Exchange Act of 1934, as amended.

32.1*	Certification of Chief Executive Officer pursuant to section 906 of The Sarbanes-Oxley Act of 2002.

32.2*	Certification of Chief Financial Officer pursuant to section 906 of The Sarbanes-Oxley Act of 2002.

99.1	Privacy Policy of the Registrant (Incorporated by reference to Exhibit 99.1 to the Registrant’s Annual Report on Form 10-K (File No. 814-00891), filed on November 17, 2011).

101.INS*	Inline XBRL Instance Document-the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document

101.SCH*	Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents

101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document

104	Cover Page formatted as Inline XBRL and contained in Exhibit 101

* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized.



	PENNANTPARK FLOATING RATE CAPITAL LTD.

Date: February 7, 2024	By:	/s/ Arthur H. Penn
		Arthur H. Penn
		Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)

Date: February 7, 2024	By:	/s/ Richard T. Allorto, Jr.
		Richard T. Allorto, Jr.
		Chief Financial Officer and Treasurer (Principal Financial and Accounting Officer)